Homebuilders See Gains in Third Quarter, But Market Still Tough

By: Alex Goldsmith Email
By: Alex Goldsmith Email

Two years ago Bofysil Construction was struggling. The housing market was at rock bottom and demand had plummeted.

But now things are starting to look up.

"It's starting to recover but it's slow," said Bofysil.

Bofysil Construction builds news homes and also renovates current homes. Bofysil says that most of his new business these days is in renovation.

"It's a lot easier and cheaper for [homeowners] to invest in what they already have," said Bofysil.

Although Bofysil's business is up significantly from the bottom in 2008, things still haven't recovered back to pre-recession levels yet.

"Since 2006, the business has only recovered about 30-40 percent," said Bofysil.

"Michigan's sluggish economy combined with continued tight credit markets has combined to make customers cautious in recent months," said Robert Filka, CEO of the Michigan Association of Home Builders (MAHB).

But some homebuilders are finding ways to increase sales even in tough times.

"We completely changed our whole product and focus around who we're building for and what we're building," said Bob Schroeder, owner of Mayberry Homes. "We're coming out leaner and more efficient."

That leaner, streamlined attitude is reflected in the homes Mayberry builds. The company says they've switched to constructing properties that are smaller, less expensive and more energy-efficient.

"Back in 2005, 2006, our average sale price was around 250,000 to 300,000 with the lowest probably around 200,000," said Schroeder. "We now offer homes from 130,000 to 250,000."

The lower price point seems to be working. This year, Mayberry is on pace to build more homes this year than they have in any year since 2004.

"Value became more significant," said Schroeder. "Business is getting better... slowly."


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