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Area builders report steady recovery

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Duncan Scott/DScott@News-Herald.com

Builder Enzo Perfetto is constructing this home on Dewey Road in Thompson Township.

By Caitlin Fertal CFertal@News-Herald.com

 

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Duncan Scott/DScott@News-Herald.com

Builder Enzo Perfetto is constructing this home on Dewey Road in Thompson Township.

Although experts predict that the slight national increase in new home construction this past month was not enough to imply market improvement, area home builders have a different outlook.

“I think people just have a feeling that if they’re relatively secure about their job, there’s some great opportunities with interest financing right now, and construction in general,” said Enzo Perfetto, vice president of the Home Builders Association of Greater Cleveland, and owner of Enzoco Homes in Chardon.

For the first quarter of 2011, Geauga County more than doubled the number of permit applications for new home construction from the previous year with 27, according to the county’s building department.

The first quarter of 2010 only brought 11 new permits.

Nationally, new home construction rose 3.5 percent from April to May, but that pace is still regarded as sluggish as the yearly report shows new permits down 13 percent, according to the National Association of Home Builders.

 

The recession caused a lull in the market while consumers were looking more closely at foreclosed homes for savings, Perfetto said. But once the cost of renovation and the compared efficiency of an old home versus new are examined, savings usually favor new home construction, he added.

Another road block for new home building was the ability for consumers to sell their current homes, said George Davis, president of ProBuilt Homes in Mentor.

“I think that was a big stumbling point,” Davis said.

“That metric has dramatically improved (over) the past six months,” he added.

Perfetto has seen similar results with his customers having greater success in selling, he said. The market seems to be picking up locally and builders are hoping the success continues.

Nationally, home builder confidence dropped on every level including projected sales and customer traffic, according to a survey by The National Association of Home Builders.

The survey showed that the only region of the United States to show an increase in builder confidence was the Northeast.

“If you listen to the (television) you would think home building is on the outs,” Davis said. “(But) we are on pace to be back to our pre-housing-recession volume.”

Part of the increased business comes from consumers who had been teetering back and forth with the idea of construction, Perfetto said.

“There’s a lot of opportunity — I think, if anything, (the market’s success is) going to actually increase because there has been a wait-and-see approach for the past two years, and people are starting to realize that the sky’s not falling and that there are great deals out there,” he said.

Davis has noticed a similar trend with his customers, he said.

“I think that a lot of people who have the finances and desire to build, for the last three years or so, they’ve been sitting on the fence trying to see when they can get their best deal,” he said, noting that the trend is changing.

New home construction was also set back in the Midwest and South because of heavy flooding and tornadoes, but again local builders reported success in withstanding the weather.

Even with the heavy rain that Ohio has seen recently, the most that had been lost on any construction job

was a day or two, Perfetto said.

As far as increased consumer interest in renting, Perfetto is not concerned.

“I think that’s part of the American dream, and I just don’t see that going away,” he said of home building.

As vice president for the HBA, Perfetto said he has noticed the success spread across Lake and Geauga counties.

“We’ve always felt that our market never had the run-ups that a lot of the markets that fell really hard did, like the West coast and down in Florida,” he said.

“Northeast Ohio has been a pretty conservative market for real estate values, especially in new construction.

“So we didn’t fall quite as hard, so I think the rebound isn’t taking quite as long to come back, and that’s why we’re seeing the activity we’re seeing.”