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Residential construction keeping Sweet Home builders busy


September 5, 2017

GABE MCCUBBINS, left, and his father, Danny McCubbins, work at the site of a home they are building off 50th Avenue that overlooks Foster Lake. They say the building boom has kept them so busy they have had to turn down jobs.

Residential building activity in Sweet Home is continuing to rise, carrying on last year’s trend that took new building construction past pre-recession levels.

According to city records, in 2008, as the community began feeling the effects of the great recession, Sweet Home issued 378 building permits overall, 267 for residential projects. Of those, 21 were for new construction.

Residential activity held on for another year, with 284 permits in 2009. Of those, just 15 were for new construction. The city issued 376 permits overall, including commercial projects. The city issued 100 permits, up from 79, for other kinds of residential structure projects.

All of those numbers declined in the subsequent years, reaching a low of 199 total residential permits in 2013. Fifteen of those were for new construction, but that number reached as low as three permits in 2011 and two in 2015.

By 2016, residential activity had recovered, reaching 282 total for the year. Of those, 40 were for new construction, the highest number since 2008. Including commercial activity, the city issued 368 permits last year.

As of Aug. 14, the city had issued 220 residential building permits this year and 275 permits total, including commercial activity. Of those, 29 were for new residential structures.

During the same period, commercial activity varied less overall, falling from 111 total permits in 2008 to a low of 68 in 2011. The city issued 85 commercial permits in 2013 and 86 in 2014 before issuing just 69 in 2015.

Of commercial permits, the city issued eight permits in 2008. The total varied from one to five until this year. As of Aug. 14, the city had issued 10 permits for new commercial projects.

With the smaller sample size for commercial projects, the trend is more unpredictable, said City Manager Ray Towry.

Towry expects activity to remain strong in Sweet Home this year.

“I think we got to that number (in 2016) at the end of the year,” he said. So some of the activity occurred this year. “I would bet we have the same number or more (in 2017). I think you’re going to see an increase in residential over time.”

The real estate market has a lot of demand and not a lot of supply right now, Towry said. They can find a higher quality of life while living within range of bigger city amenities and activities.

“A lot of people are figuring out Sweet Home is a pretty great location,” Towry said.

Don Robertson, owner of Heritage Northwest, said the supply dried up after the recession as property owners began waiting for their property values to recover and rebuild their equity. As property prices recovered, though, many property owners have found they have to spend a lot more to buy their next homes after selling.

That’s caused many of them to continue holding on, Robertson said. Off the cuff, he thought the demand for property is five times the number of properties for sale, the strongest seller’s market he’s seen.

“There’s some interesting dynamics in the market right now, where sellers and buyers are super savvy,” Robertson said. They are far more educated than they have been historically. They know value, what they can afford and when to get in and get out.

Robertson is concerned that many people who might have been able to buy three or four years ago cannot buy now. While prices have rapidly inflated, wages have not kept pace, making the purchase of a home “a real stretch.”

Recently, Robertson said, Sweet Home has seen quite a bit of construction, as has Albany. Corvallis has seen an uptick, but Lebanon has seen little activity.

Sweet Home’s Planning Office is seeing more residential planning activity, Towry said, and contractors who normally have handled one or two projects at a time are doing three or four.

Weather, the extra wet spring, may have played a factor in construction activity as well, he said.

When the recession hit, said Danny McCubbins, owner of McCubbins Quality Homes, activity switched over to remodeling.

The wait was short for McCubbins and his son, Gabe McCubbins who owns McCubbins Cutting Edge. Normally, they build large custom homes and don’t work on too many projects at once. They generally build three to five homes a year.

Since about 2007, they haven’t been very busy within the Sweet Home city limits as they began focusing on the bigger custom housing, Gabe McCubbins said.

After the recession, for about a year and a half, they were looking for anything – from building decks and smaller projects to remodels – to put food on the table. By 2012, they were back to building custom homes.

“We have two going in Sweet Home right now, the first ones we’ve done in Sweet Home in six years,” McCubbins said. They’re also working on a home outside the city limits, off 50th Avenue.

“We actually have turned down quite a bit of work,” Danny McCubbins said.

“It has gotten really busy,” Gabe McCubbins said. “What’s hard is to give up good jobs when you remember doing anything (you could).”

That’s the reason they are able to stay in business when the economy is poor, Gabe McCubbins said. They don’t take on jobs they can’t do.

“We want our customers to be happy,” Danny McCubbins said. “We have no desire to mass produce houses. We build every house like it’s our house.”

As other contractors pick up the work, it’s getting pushed out, Gabe McCubbins said. Contractors are busy.

Gabe McCubbins cited the example of another contractor who built 15 foundations and completed one house per month.

Danny McCubbins said some contractors are pushing jobs out; he said they’ve had lots sitting next to theirs for months with nothing happening.

They warn that a market like this can lead to low-quality work by people who are not licensed contractors.

Such contractors come out of the woodwork, saying they can build for 30 to 40 percent less than licensed contractors, Gabe McCubbins said, and the Construction Contractors Board has been “busting” a lot of people.

TWO NEW HOMES under construction on Boulder Ridge Drive, at the intersection with Elkhorn Street, are among the new residential buildings going up in Sweet Home. There are three new homes going up in Canyon Creek alone.

Danny McCubbins noted that the houses he and his son build are relatively inexpensive.

Their expenses are in building stronger, heavier homes, Gabe McCubbins said.

He and his father have more confidence in the current market, Gabe McCubbins said. People buying houses are different than they were before 2008. They couldn’t afford the homes and lost them.

The people the McCubbins are building for are different and can clearly afford the homes they’re buying, Gabe McCubbins said. “The banks are getting smarter.”


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