To: benwood who wrote (144197 ) 1/16/2002 6:40:10 PM From: Bill/WA Respond to Hey Ben,real controlling factor in construction was first and foremost, interest rates and the banks grip on liquidity. Unless unemployment was excessive and the economy totally in the dumper (and recognized...not like with the unbelievers today), building would continue and maybe slow just a little. And on the residential side, building on spec, we would always figure 6-8 months of mortgage payments after the structure was CO'd to carry it until sold. This is why I always used sales rather than permits issued, to determine the housing market. Builders would always continue to build, even in the face of falling indicators because they had figured a decent 'take home' profit in the price of construction - let the home sit - if it didn't sell - let the bank have it back. The bigger the builder or developer the easier it was to get back into the bank's good graces on the next upturn. I was never big enough to take advantage of this, however I have built several multi-$1 mil+ homes for these same builders and developers (as they would NEVER use their own crews to build their personal homes). This would give you an idea of the quality of their own construction projects ;-)
