Houston has a great problem. The fourth largest city in the nation is in the midst of a business boom and the continual highway and building construction is proof thereof. The problem, however, is that supply is struggling to keep up with demand.
The problem has been ongoing for a long string of months and it may not lighten up anytime soon. With the constant building everywhere in the Houston-area, “shortage” has become a buzz word in the conversation of home building. With the influx of new residents, especially due to major oil and gas companies moving some of their operations to the area, the demand for new homes continues to skyrocket.
Labor Shortages
“Due to the slowdown in the building industry in the past five years, contractors have left the area and into other business such as the oilfield,” said Andrew Lahasky, area manager of Design Tech Homes. “Now that the housing market is booming with sales, there are not enough trades to do all the work.” He said this shortage of labor is affecting every area of construction, including supplies like concrete.
Russ McKinney, regional sales manager at Kent Moore Cabinets, added that the shortage isn’t just affecting the home builder, but other businesses that rely on the residential construction industry.
“We’re commonly three to four weeks out from (cabinet) installation,” said McKinney. “There are delays on houses being framed and textured to being ready for cabinets.”
He added that the shortage of skilled laborers, like qualified builders, insulators, and sheetrockers, has been the cause for major delays and that this has been an issue for about the past six months. McKinney said the problem has increased during the summer months, a time when home buying is at its annual peak.
“In every stage you must wait for the next available trade to do the work and if for some reason you miss the window to get that job done on the scheduled date,” said Lahasky, “then you are put at the end of the line and must wait your turn to get that particular trade back to the house to complete the work.”
With these labor delays also come financial delays in regard to creating revenue.
“We have about $1.5 million in cabinets waiting to be installed,” McKinney said.
End in Sight?
McKinney said that, historically, when summer comes to an end home building starts to slow, which helps builders, cabinet-makers and others catch up. With so many new home buyers streaming in at a near alarming rate, one can only wonder how long it will take for builders to get back in the lead. “I don’t know,” McKinney said regarding if things will slow down come fall. “That’s the million dollar question.”
Although the delays are having some negative effects, Houston continues to find itself in a positive spot with an ever-promising economy, while home builders and suppliers are in a positive place of constant demand.
