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Author
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Topic: For those of you that live in the midwest.
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Aznative
FARTS ON CLUELESS LIBERALS
Member # 506
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posted February 06, 2010 03:36 PM
This just might be news to you. California, Arizona, Nevada, and Florida have growth based economies that saw rapid expansion until 2007. Then the bubble broke and our economies have been hammered. My son and I have many friends in the construction business that are facing bankruptcy. A local team of economists are saying Arizona's real estate market will not improve until 2014 when property prices will probably reach the values we saw in 2005.
This article comes from Time.
http://www.time.com/time/nation/article/0,8599,1960639,00.html
The Great Recession: Will Construction Workers Survive?
By Kevin O'Leary / Los Angeles Saturday, Feb. 06, 2010
The middle and working-classes have been hammered by the Great Recession and no industry has taken it more on the chin than construction. Nationally, unemployment fell to 9.7% in January, but in construction it jumped to 24.7% from 18.7% in October. In many regions, union officials report 30% of their members are unemployed or "riding the bench." "In the previous 14 years, I had not been out of work for more than one week," says Pat O'Connor, 57, a Connecticut carpenter. With no work since July, O'Connor says, "It is a bad dream turning into a nightmare. Is construction dead? It's just horrible right now. No one expected this. It's a depression." He has a mortgage and is worried he will fall behind and lose his condo. "When I go to bed, I keep the TV on just so I have the noise. If it gets silent, I get a panic attack."
Commercial construction workers are in a bind. Before, if work dried up in Boston or Seattle, carpenters, electricians and plumbers would pack up and go to Las Vegas or Texas or Alaska. "Now there is no work anywhere," says Mark Erlich, whose New England Regional Council of Carpenters represents 22,000 union members in six states. "The largest problem is the continued lack of financing," says Jerry Rhoades, executive secretary treasurer of the Florida Carpenters Regional Council. "In the summer of 2009, there were 800 jobs on the books to build across the state. We do commercial, high-rise residential and power plants. The permits were ready, but the financing dried up. I am in my 60s and I've never experienced a downturn like this. Three years ago, three contractors would bid on a project. Now 90 contractors bid on a project. That is how desperate people are."
In the Southwest, the construction site is what the factory floor is to the MidWest — the place where blue-collar men and women earn their keep. A tour of downtown Los Angeles and the industrial warehouse area to the south finds busy jobs sites few and far between. In Vernon, Oltmans Construction Co., ranked as one of the nation's elite "Top 400 Contractors" by Engineering News Record, is completing a gleaming white 60,000 square foot warehouse and office space for CR Lawrence whose business is construction, industrial, architectural and automotive supplies. Ed Sorbel, superintendent for Carpenter's Local 630, says at the project's peak more than 70 men worked at the site. But the outlook is grim for commercial construction firms such as Oltmans and its union work force. Asked if business is picking up, Oltmans Project Manager James Wu, 37, says, "I have not seen it. It's not looking good ahead."
General Foreman Javier Gonzalez, 50, wearing a red bandana and an orange Oltmans T-shirt, says, "I was only out of work for two months in '09." Other carpenters were not so lucky. Gonzalez says his laid-off colleagues are paying their bills in a variety of ways. "One guy is doing tattoos. Some guys are bartending. And there is a group who work for realtors cleaning out foreclosed homes. They empty everything that is left in the house, resell what that can salvage and do minor repairs. It's sad. There is no work right now. Here we are in February and we've only picked up one job this year. In four weeks when this job is done, I'll be out on my ass."
Local 630, based in Long Beach, has 400 carpenters in the field with Oltmans when business is strong, says Sorbel, the union's top man on the Vernon project. "We are trying to keep our core guys, 125 to 150 men, busy. But there is no work out there." Miles Davy, a burly asphalt subcontractor, says there have been massive layoffs across all sectors of the construction trades. "I've had to let go men I have known for years. Grown men crying in my office. It's the saddest thing I've ever done."
In downtown Los Angeles, just east of Little Tokyo, one of the only active construction sites is a 53-unit apartment building at Alameda and 4th Street. Valentin Marquez, 41, father of four, does foundation and concrete work. Before this job he says he was out of work for a year. He is now struggling to keep his house. "The company I worked for for 18 years went bankrupt," he says. His colleague, Alonzo Chavez, 34, worked for the same contractor and then took a job in a burrito factory at minimum wage. Both non-union men, hands gray with concrete dust, know this job will only last another two months. "This year looks rough," says Marquez as he sits in the cab of his blue GMC pickup truck.
In the Northwest, the contraction in commercial construction came late, says Eric Franklin, spokesperson for the Pacific Northwest Regional Council of Carpenters. "We're at the bottom now." Across a membership of 26,000 in 42 locals in five states unemployment ranges from 21% to 35%. One bright spot: a few big public projects on the horizon, including a floating bridge that will connect Seattle to its suburbs. "It's a mess," says Erlich in New England. "The private sector is dead. We're at the point where we are considering investing money from our pension fund in construction projects. We either need another stimulus focused on job creation or the banks must be directed to lend."
North America's largest building-trades union, the United Brotherhood of Carpenters is a half-million members strong. For tens of thousands of its members, and the millions of Americans who depend on the construction business to make a living, it is a winter of anxiety and discontent. Tim Ahern of Carpenters Local 210 in Fairfield, Connecticut sums up the plight of the construction trades across the nation. "I only worked 20 hours the whole year in 2009."
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Never thought the devil would need a teleprompter but I could be wrong.
United State of America: RIP
Born July 4th 1776 died November 6th 2012
Posts: 1937 | From: Phoenix Az | Registered: Jan 2005
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Leonard
HMFIC
Member # 2
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posted February 06, 2010 03:51 PM
Who is responsible for this mess?
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EL BEE Knows It All and Done It All.
Don't piss me off!
Posts: 32361 | From: Upland, CA | Registered: Jan 2003
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Aznative
FARTS ON CLUELESS LIBERALS
Member # 506
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posted February 06, 2010 03:58 PM
George Bush who else.
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Never thought the devil would need a teleprompter but I could be wrong.
United State of America: RIP
Born July 4th 1776 died November 6th 2012
Posts: 1937 | From: Phoenix Az | Registered: Jan 2005
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Kokopelli
SENIOR DISCOUNT & Dispenser of Sage Advice
Member # 633
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posted February 06, 2010 04:06 PM
Yeah, but are you better off than you were four trillion dollars ago????? ![[Eek!]](eek.gif)
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And lo, the Light of the Trump shown upon the Darkness and the Darkness could not comprehend it.
Posts: 8231 | From: Under a wandering star | Registered: Apr 2005
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Paul Melching
Radical Operator Forum "You won't get past the front gate"
Member # 885
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posted February 07, 2010 05:13 AM
The last time I was in this condition Jimmy Carter was president.... Whats that tellya?
I have gone from making payroll for 50 familys to 7 and thats part time part of the time.
For the first time in my life I am completely freaked out!
With complete conviction I say fuk a bunch of socialist bastards liberals are clueless pieces of shit.
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Those who value security over liberty soon will have neither !
Posts: 4188 | From: The forest ! north of the dez. | Registered: Jul 2006
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Aznative
FARTS ON CLUELESS LIBERALS
Member # 506
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posted February 07, 2010 08:05 AM
I believe this is worse than the mess Jimmy (please shut your trap) Carter created. I have a customer that is in the vending machine business. They have gone from six to three employees: The husband, the wife and the son. They were doing over a million a year gross three years ago with three outside employees. 2009 they did 365k. I did a job for them last week and asked how things were going. They are losing a client per week on average. They had just lost one that day. The clients are shutting down or cutting the work force so low it isn't worth keeping the vending machine in place. This keeps up they won't be able to afford for me to fix their vans.
Another friend of ours is in the custom home site excavation business. They are basically shut down right now. They have an outstanding fuel bill so they are cut off from their supplier. They are only getting odd jobs once in a while to help put some groceries on the table, and they pay for the fuel out of pocket to do those jobs. Local economists are saying it will be another four years before we can get rid of the local housing surplus. Most recessions last 18 months and then things get back to normal. Well we are two years into this, and things are not going back to normal for another four years. How are people going to hang on.
BO has the lowest number of staffers with business experience in history. As I recall from Fox News it is near 5 percent. His staffers know two things: How to expand government and how to blame George W Bush. They are totally ignoring things that help business in the past such as cutting the marginal tax rate, cutting capital gains taxes, cutting corporate taxes, cutting employment taxes and giving businesses an investment tax credit. Instead he wants to regulate and tax the banks that paid us back the tarp money while giving Freddie, Fannie, AIG, GM and Dodge a free ride. This is nothing short of corporate wealth re-distribution(e.g., corporate socialism). Every industry out there is worried they are going next group to be in BO’s gun sights. Who in their right mind would want to expand in this business climate when you are worried about being taxed at higher rates or worse yet being regulated by big Gov in the near future.
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Never thought the devil would need a teleprompter but I could be wrong.
United State of America: RIP
Born July 4th 1776 died November 6th 2012
Posts: 1937 | From: Phoenix Az | Registered: Jan 2005
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Leonard
HMFIC
Member # 2
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posted February 07, 2010 09:34 AM
quote:
George Bush who else.
So...that was a joke? I was worried about you, for a minute.
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EL BEE Knows It All and Done It All.
Don't piss me off!
Posts: 32361 | From: Upland, CA | Registered: Jan 2003
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Andy L
HI, I'M THE NEW MODERATOR OF THE CENTRAL MISSOURI FORUM, PULL MY FINGER!
Member # 642
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posted February 07, 2010 09:46 AM
This little town I live near is drying up. A town that was 4500 people last census. It had 3 factories, supplying about 1500 jobs. Three car dealerships, Ford, Chevy and Dodge, employing about 250 people total. Several restraunts and other business's.
One by one the factories closed. Soon, all the dealerships were gone. Now the restraunts are disappearing one by one. Gas stations are closing. People, if they can find a job, are having to go to Jefferson City or Ft Wood. Both are just far enough that people are moving instead of commuting. Lots of houses. Used to have 3 real estate offices. Now out of town realtors do what little selling takes place.
Its sad. There was a restraunt that had been there since I can remember. Kinda local famous. People would come from miles to eat breakfast there. Gone. One of the dealerships had been there for over 50 years. Gone.
No people, no money, it affects us all.
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Andy
Posts: 2645 | From: Central Missouri | Registered: Apr 2005
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Leonard
HMFIC
Member # 2
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posted February 07, 2010 10:28 AM
Yeah? Then why did those good people vote for "Change they can believe in" ?
I should talk? California is so far down the shitter that it will never recover. If I could sell some property, I'd be out of here by next year.
Good hunting. LB
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EL BEE Knows It All and Done It All.
Don't piss me off!
Posts: 32361 | From: Upland, CA | Registered: Jan 2003
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Andy L
HI, I'M THE NEW MODERATOR OF THE CENTRAL MISSOURI FORUM, PULL MY FINGER!
Member # 642
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posted February 07, 2010 11:03 AM
You can rest assured that Miller County Mo had nothing to do with this SOB being elected. You cant live in this county if you dont vote republican. Ok, you can, but you are far in the minority.
Hell, McCain won Missouri for that matter. Dont blame this shit on us.
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Andy
Posts: 2645 | From: Central Missouri | Registered: Apr 2005
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Andy L
HI, I'M THE NEW MODERATOR OF THE CENTRAL MISSOURI FORUM, PULL MY FINGER!
Member # 642
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posted February 07, 2010 11:05 AM
BTW, speaking of California, I like Glenn Becks assessment. Everyone is always talking about a states right to leave the union, he wants to know if the union can get rid of a state. If so, Cali will be kicked to the curb. LMAO
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Andy
Posts: 2645 | From: Central Missouri | Registered: Apr 2005
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Locohead
World Famous Smoke Dancer
Member # 15
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posted February 07, 2010 11:24 AM
Leonard,
You've mentioned several times over the last year or two that you'd move if you could get rid of your house? Something to that effect. Anyway, We've decided to invest some money into our little house, fix it up real nice and then sell it real cheap. It feels like you're losing money only for a minute. The bank owned owned properties can be had for super duper cheap. So in other words, you don't make nearly as much as you would've on the sale, but you make it (and a whole lot more) back on the buy side.
That is our plan, and we are in the middle of implementing it right now. I'll let you know if it fails or not! ![[Smile]](smile.gif)
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I love my critters and chick!!!! :)
Posts: 2219 | From: CO | Registered: Jan 2003
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Locohead
World Famous Smoke Dancer
Member # 15
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posted February 07, 2010 11:48 AM
P.S. Paul,
At the last camp-out at your pad, I'd told you I had lost half my guys and now the builders were forcing me to lower the prices. Mr. Shaw told me he never would; I think that was your position at the time also. That was how I'd felt for many years. Nope, we sell quality, if you want cheap, find someone else. Unless you and Randy have it different where you folks come from How do you stay busy? I used to run 6-7, 3-4 man crews all year round. Now I run 1 - 3 man crew. It's all I can do to keep them busy. I do have 2 customers that recognize quality and are willing to pay a small premium. We are the only painter's they trust because they build multi- million $ stuff)
Anyway, just wondering if your markets have forced you guys to lower your prices much? I charge what I can but if I have to lower my price to get the work; in some cases I will - and hate it all the way but I've mouths to feed and bills to pay. I've taken to paying piecework only to the guys so that we all make less money. If they show a little hustle, ironically both the guys and myself make more money.
Perhaps, it's different in your trades but any dummy with a brush can paint - right? So there are about fifty million painters running around looking for work - guys without insurance, workers comp., maybe they're not paying their taxes or material bills. But those little boogers are the ones getting much of the work out there.
I still charge as much as I can, when I can. But have any of you contractors out there found yourself lower prices just to get the work? Man I hate having to do it but if I stick to my guns and keep selling quality for a premium - I'll starve!
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I love my critters and chick!!!! :)
Posts: 2219 | From: CO | Registered: Jan 2003
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Leonard
HMFIC
Member # 2
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posted February 07, 2010 11:58 AM
If it were only that simple, Danny.
I'm nowhere near upside down on my properties, but it still hurts to sell for ten cents on the dollar. (a slight exaggeration)
It does not soothe to know that anything I would buy (in AZ) with the proceeds is also a bargain. It's still a huge loss, on paper. That isn't a phantom loss, it is a genuine loss of wealth and don't let anybody tell you any different. It's a crying shame, and the bastards that created this mess are not being held to account.
Good hunting. LB
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EL BEE Knows It All and Done It All.
Don't piss me off!
Posts: 32361 | From: Upland, CA | Registered: Jan 2003
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Locohead
World Famous Smoke Dancer
Member # 15
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posted February 07, 2010 12:13 PM
Oh I know Leonard! Its a crying shame. I'm just trying to strategize to minimize the pain.
My situation is unique. I just got screwed super duper big-time over the last 2 years. I wasn't paid on many jobs - money that I couldn't afford to carry myself - I borrowed to pay my guys and paint bills. I accumulated a monster line of credit from a loan shark - interest only loan at 18%. Sound foolish? Yep, but sometimes one does what they have to at the time - figured I would get paid, I was told I would.
Anyway, my house is worth $215k - $227k based on current sales. I'm going to paint in-side and out, new carpet, new kitchen counters etc. and list it for $214k. I made an offer this weekend on a 4 bedroom, 3 bath, 60 acres for $135k. It will require at least $50k to finish the house but I will have a much larger house for the family - land like I've always wanted.
P.S. Anyone know an investor willing to take interest only payments on $100k plus at 10%? I'd save a ton a money each month - was thinking about trying craigslist. 18% is killing me.
[ February 07, 2010, 12:16 PM: Message edited by: Locohead ]
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I love my critters and chick!!!! :)
Posts: 2219 | From: CO | Registered: Jan 2003
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Leonard
HMFIC
Member # 2
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posted February 07, 2010 12:26 PM
Everybody is just walking away from those kind of terms, and the part that pisses me off is that they will probably suffer no consequences, credit wise. The worst credit risks seem to be eligible for the cheapest loans, guaranteed by the Federal Government...Hey, you're a minority, aren't you? Claim that you didn't understand the terms of your loan. Man, everything is just crazy!
Good hunting. LB
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EL BEE Knows It All and Done It All.
Don't piss me off!
Posts: 32361 | From: Upland, CA | Registered: Jan 2003
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Paul Melching
Radical Operator Forum "You won't get past the front gate"
Member # 885
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posted February 07, 2010 01:13 PM
Danny
On comercial jobs we have had to slice and dice just to get a little work. Many jobs I get last look at are below cost and I have to just smile and walk away. Residential work is all but non existent! I think I'll go to work for acorn theyre doing quite well.
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Those who value security over liberty soon will have neither !
Posts: 4188 | From: The forest ! north of the dez. | Registered: Jul 2006
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Aznative
FARTS ON CLUELESS LIBERALS
Member # 506
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posted February 07, 2010 01:31 PM
Leonard, you must of not gotten the memo. George W is now the national scape goat. We can blame everything on him. If I don't do my job right and a car comes back, I just blame it on Bush. That's what BO does.
I too have taken a beating on property. I bought three rental homes 12 years ago. Right now I could probably sell them for what I owe. But after I pay the capital gains and the selling fees, I'll lose money.
I'm right side up on my personal home and some other property a little west of phoenix. But it sure isn't worth as much as it was in 2004 before the bubble went crazy. At the risk of repeating myself: There is a local group of economists that meet every year in January in Phx. Last year they said that the housing markets would return to 2005 levels in 2012. This Jan they said because of the high unemployment, it will be 2014 before we see 2005 prices. This housing crisis and unemployment problems seem to be feeding themselves.
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Never thought the devil would need a teleprompter but I could be wrong.
United State of America: RIP
Born July 4th 1776 died November 6th 2012
Posts: 1937 | From: Phoenix Az | Registered: Jan 2005
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Andy L
HI, I'M THE NEW MODERATOR OF THE CENTRAL MISSOURI FORUM, PULL MY FINGER!
Member # 642
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posted February 07, 2010 03:32 PM
Im not sure we need to see 2005 property prices for a while. And yes, I own property. Im sorry, but I think that may have been part of the problem. Property prices were way over inflated in many parts of the country.
Not so much here. For example, one of my houses here, I gave 60k for it in 1994. In 2005, it appraised for 170k. Last fall, it appraised for 135k.
I went to AZ in 2006 and looked for property, actually was with Fred quite a bit. I couldnt believe the difference in cost. Unreal how high things were, or it seemed to me anyway, and lots of places available. I bet they are cheaper now!
Anyway, property prices getting so inflated, people borrowing as much as they could against it and paying as little as they could on it, was a big part of what took down our economy. I think this correction may be healthy in the long run. A flush if you will.
Right down the road about 10 miles or so, is a tourist trap known as Lake of the Ozarks. Its very popular with rich folks, and not so rich, from Kansas City, St Louis and Chicago. 1200 miles of shoreline. Not hardly a foot of it that doesnt have a sea wall and a house on it. Many of them cost in the millions or close to it. And most are second homes, used from April to September each year. Most have a dock that cost anywhere from 30k to 300k and most have a couple of boats and a couple of wave runners worth about the same or much more than the dock. My mom is an appraiser here at the lake. She tells me that the game was that people that had very little money saved, but made good money and had owned their homes in one of the cities above, for quite some time and had alot of equity, were coming to the lake and using the equity for a down payment on a lake house and all the toys, a lot of the time the house, dock and watercraft are sold turn key, getting a intrest only loan with a balloon and partying on down. Then the notes came due. This was about the same time the economy crashed nationwide, so I assume this was going on other places? 10 miles from here, property values have dropped a ton more than here because of that.
I think it needed correcting and get prices back to a normal level, normal appreciation annually and get some of the folks out that have no business owning a home and sure not a second home. JMHO
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Andy
Posts: 2645 | From: Central Missouri | Registered: Apr 2005
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Aznative
FARTS ON CLUELESS LIBERALS
Member # 506
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posted February 07, 2010 05:26 PM
In 2005 my rentals had seen fairly normal appreciation up to that point. They were worth may 110-130k or about 90 bucks per sq ft. In 2007, they were worth double that. Today they are worth about $65 per square ft. It would probably cost a home builder about 100/sq ft to develeop, build and market an average home today. The reason existing homes are selling so cheap around here is the huge supply of bank owned homes. It all came about because of this creative/loose financing. We don't want to return to liar loans and subprime lending practices. What we need is for a good healthy economy with well paying jobs. That will take care of the real estate market after the surplus is gone. This recession is going to hang around for a while I'm afraid. Four more years according to the experts.
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Never thought the devil would need a teleprompter but I could be wrong.
United State of America: RIP
Born July 4th 1776 died November 6th 2012
Posts: 1937 | From: Phoenix Az | Registered: Jan 2005
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Dusty Hunter
Knows what it's all about
Member # 1031
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posted February 07, 2010 05:27 PM
Quote: "There is a local group of economists"
Yeah, I trust those guys about as much as soggy toilet paper.
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