In today’s news, we will look into the reports from homebuilders, that the slowdown in the housing market is on the verge of becoming more severe, and according to them a high interest rate environment will discourage purchasers in 2023. A Philadelphia framing contractor is being urged to pay $269,594 in fines for endangering workers with fall hazards on April 21, 2022. An Honorable Award from Engineering News-Record Has Been Bestowed Upon the Specter Center. In 2024, Amtrak will begin construction on a new and improved Connecticut River Bridge.
As purchasers draw back, homebuilders fear a steeper downturn
High interest rates will frighten away buyers in 2023, say builders.
Single-family home starts declined nearly 19% year over year in September. Permits for new buildings declined 17%.
One Denver home builder called it a “hard landing”
Some homebuilders think the property market will only get worse in the new year as fresh orders dry up.
Rising mortgage rates have made once-eager homebuyers wary about their investment and the economy.
Gene Myers, CEO of Thrive Homebuilders in Denver, one of the hottest markets during the coronavirus pandemic, predicts a cliff in January.
Covid helped U.S. homebuilders. Record low mortgage rates and increasing demand from consumers looking for more space created a housing rush. Home prices soared 40% in two years, and builders couldn’t keep up. They slow sales to keep up. It’s over.
Single-family home starts declined nearly 19% year over year in September. Permits for new buildings declined 17%. PulteGroup, one of the nation’s top homebuilders, saw its cancellation rate soar from 15% to 24%.
So far, public homebuilders have posted fairly high earnings, although much of it is based on a backlog of homes that went under contract last spring. Before mortgage rates topped 6% and 7%.
Now builders are ready for more. Myers said his company’s balance sheet is healthy due to a backlog of high-priced homes, but he expected the market will be “grim” next year.
“Housing has a rough landing,” he remarked. Any prospect of a soft landing vanished last spring when it became evident that customers used to low mortgage rates would go on strike.
Myers lived through the last housing catastrophe, which was caused by a broken mortgage industry where anyone could acquire a loan. Investors’ speculative purchasing and selling created a housing run. Single-family dwelling starts decreased 80% from January 2006 to March 2009, however it was a slower decline than presently.
“This is the most rapid market change of my career,” he remarked. I’ve never seen a sales tank as they did in May.
Six months ago, single-family housing starts were up 10% y/y. Before mortgage rates jumped quickly. From a 10% yearly gain to a 19% decrease is a historically fast shift.
New house sales are down, but prices are up from a year ago. Mostly due to high labor and material costs. Part of the price strength may be due to higher-priced residences selling. This may change soon.
Sheryl Palmer, CEO of Arizona home builder Taylor Morrison, said entry-level purchasers are suffering. She also said high-end customers aren’t rushing in.
“Move-up and resort lifestyle purchasers may still afford to buy, but emotionally, you need confidence,” Palmer said on CNBC’s “Mad Money” Even at today’s rates, FHA and conventional buyers have a lot of room, but it doesn’t imply they have confidence, given the economy.
Palmer told analysts on the company’s results call that September new orders were down “sharply” The slowdown was seen across price points, geographies, and customer groups. Taylor Morrison is cutting land investments, slowing building, and offering buyers more incentives.
New house sales fell below pre-pandemic levels in September, and cancellations are double what they were a year ago.
This will be the first year since 2011 to witness a fall in single-family starts, the NAHB stated. Some economists say the housing market is currently ‘balanced,’ but the homeownership rate will decrease in the coming quarters as increased loan rates and building costs pricing out a big number of buyers.
New-home supply is high, while existing-home listings are low. One-quarter of builders are cutting prices, per NAHB.
That’s the unknown. New and existing home prices are dropping, but economists disagree on whether they will drop year-over-year and how much. Myers says new construction prices might decrease 20%.
Because our building expenses have risen so quickly, we just need to go back a little over a year to be 20% less than we are now, Myers said. “Returning to 2020 doesn’t sound as outlandish as a 20% price correction. I guess that must happen if we’re to regain speed.”
Philadelphia contractor’s history of exposing workers to deadly fall hazards continues; DOL proposes $269k in fines
A Philadelphia framing contractor faces $269,594 in recommended penalties for exposing employees to catastrophic fall hazards on April 21, 2022.
Max Contractors Inc. was examined after OSHA received a report that workers were exposed to fall hazards while framing a Carson Street home. Inspectors saw second- and third-story workers without fall protection near floor holes and the building’s edge, exposing them to 22-foot falls.
OSHA cited the company for three serious and six repeat violations for failing to provide fall protection, protective eyewear when utilizing air-powered nail guns, and correct ladder use. Company fined $269,594
Max Contractors Inc. has a history of violating OSHA regulations. The company was cited for five willful and 21 significant fall protection infractions in eight 2021 inspections.
Theresa Downs, Philadelphia OSHA Area Director, said Max Contractors’ continuous disregard for worker safety won’t be permitted. Falls can cause disability and death. OSHA will hold Max Contractors Inc. accountable until they respect workers’ rights to a safe workplace.
351 construction workers perished through falls from height, according to the BLS.
OSHA’s stop falls website provides safety information and video presentations in English and Spanish.
The company has 15 business days to comply, request an informal consultation with OSHA’s area director, or appeal the findings before the Occupational Safety and Health Review Commission.
Specter Center receives an ENR award
Original Source: Specter Center Receives Prestigious Engineering News-Record Award
The Arlen Specter US Squash Center is ENR Mid-2022 Atlantic’s Best Project for Sports/Entertainment. ENR announced the win on Oct. 17.
ENR (Engineering News-Record) is the “bible” for construction news, analysis, commentary, and data. ENR covers the best design firms, architects and engineers, and construction businesses with U.S. and global projects. ENR connects US and global contractors, project owners, engineers, architects, regulators, and suppliers.
US Squash, Gilbane Building Co., Van Potteiger, and Drexel University won. US Squash awarded Dan Keating the W. Stewart Brauns, Jr. Award last year for his role in the initiative.
“In my 45-year experience in construction and development, every owner, builder, architect, and professional involved holds Engineering News-Record as the book of record on the building business,” Keating remarked. “It’s a feat that this project is one of the best in the country. Gilbane, Van Potteiger, and all engineers and financiers worked together. Without Drexel University and President John Fry, there would be no building. Ned Edwards was a wonderful leader for our project. Ned was the guiding light that infused passion into the project and devoted attention to every detail, making the Specter Center what it is today. Noel Eisenstat consulted on the project’s complex Historic and New Market Tax Credits. Gabe Canuso of D3 Developers was a great project manager and useful to the team and our contractors and suppliers. I’m honored to have worked with these remarkable men and women.
The Specter Center formally opened on October 3, 2021.
Ned Edwards, Executive Director of the Arlen Specter US Squash Center, said he was happy and grateful for the project’s collaborators. “Dan Keating’s leadership and monitoring gave us confidence in the project’s outcome. Dan is a Philadelphia construction legend and squash player. US Squash was lucky to have Dan lead this complicated Specter Center project.
Amtrak’s new, quicker CT River Bridge will be built in 2024
Original Source: Amtrak will begin building new, faster CT River Bridge in 2024
Amtrak will start hiring contractors in 2023 for a new Connecticut River Bridge.
In 1907, the Scherzer Rolling Lift Bridge Company of Chicago built the bridge to connect Old Lyme and Old Saybrook across the Connecticut River. Also called the Connecticut River Railroad Bridge or the Amtrak Old Saybrook-Old Lyme Bridge, the lifting bridge has antiquated technologies and has been stuck multiple times in the 21st century.
“Necessary improvements to Connecticut’s rail infrastructure are coming,” said Sen. Richard Blumenthal, D-Conn. “The busy Northeast Corridor’s Connecticut River Bridge needs maintenance badly.”
The renovation will shorten commuting times at Connecticut River Bridge, a bottleneck on Amtrak’s Northeast Corridor from Washington D.C. to Boston. New electrified two-track with a moveable bridge will be built. That involves upgrading power, communication, controls, and security.
This project is part of a $13 billion governmental initiative to rehabilitate railways over five years. Hearst Connecticut Media claims this idea would reduce travel time to New York by 25 minutes, connect trains from New Haven to Penn Station, bring Wi-Fi to all trains, and more.
“Reliability, speed, safety, and on-time trains are crucial to riders in Connecticut,” stated USDOT Senior Advisor Carlo Leone. All of these are things this strategy addresses, embraces, and invests in.
The new Connecticut River Bridge will be built in 2024 and last for 150 years.
Summary of today’s construction news
Overall, we discussed today home builders predict that in 2023, high borrowing rates will discourage potential purchasers. Year-over-year, September saw a roughly 19% drop in the beginning of construction on single-family homes. New construction permits went down by 17%, and one called it a hard landing. The US Department of Labor proposes $269k in penalties against a Philadelphia contractor with a history of repeatedly putting workers in danger by failing to properly secure scaffolding exposing them to 22-foot falls. In the category of sports and entertainment, the Arlen Specter US Squash Center won ENR’s Mid-2022 Atlantic Best Project award. On October 17th, ENR reported the victory. By 2023, Amtrak expects to have begun hiring contractors in preparation for the start of work on a new Connecticut River Bridge. Built across the Connecticut River between Old Lyme and Old Saybrook in 1907 by the Scherzer Rolling Lift Bridge Company of Chicago.