Martha's Vineyard Real Estate : Builders lament slowdown, homeowners look for savings
By Susan L. Silk
Published: June 23, 2011
It is hard to find a Martha's Vineyard home builder willing to talk about the "state of the industry" these days. But, based on a small survey of Island construction companies whose owners and staff will talk, this is as competitive a time as any of them can remember.
John Smith (not his real name), asked not to be identified because his company builds homes that cost at least $5 million. He said, "in general we are busy" with work in progress to be completed in spring, summer and on into 2010. "The phone is still ringing, asking for prices and proposals for projects into 2012." Construction companies working on homes costing less than $800,000 "are getting pounded," he said.
"The ubber wealthy are looking to take advantage of the current economic situation...they know that commodity market is down, and building materials are commodities. They know that they can get better pricing on labor. They are looking at what we do and asking for more competitive pricing," he said.
According to Laurence Clancy, Clancy Construction of Oak Bluffs, his business is off by about 40 percent. Instead of building new homes, he finds his business has shifted to renovating and adding to existing homes. Now, Mr. Clancy says, he is hearing more and more clients asking "where can I save money?"
In a conversation overheard in a doctor's waiting room, two men in the home construction industry lamented the situation. "Last year at this time, I had nine or ten guys working, this year it is three guys," one said. And, he added, "I am having to bid on work and losing the bid to guys who are saying they can do the work cheaper - at prices I have not seen since 1995."
John Jones, John Jones Construction Co. (Vineyard Haven) echoes that sentiment. "These days, I find myself competing against nine other bidders on a new project. But, when you are just looking at price you are susceptible to someone telling you what you want to hear."
Jones reports that his new construction business is off by 10 to15 percent, yet he is staying busy doing what he began his business doing 19 years ago - renovations and restorations. "I put in a bid, and someone beat me by thirty percent. I know what that job is going to cost, and that guy can not do it for that price, and he won't do it for that price."
However, Jones says the current situation has a bright side as well. "The construction business is going to shake out, so a lot of the guys who are creating a bad reputation for the construction business on Martha's Vineyard are going to go out of business. Those guys who really squeezed the margins in times like this will be forced out of business."
And, Mr. Jones says, it is a great time to get work done, because prices are fifteen to twenty percent less and "you are still going to get quality guys doing the work."
Gino Mazzeferro, ICMC, Inc. (Tisbury), says that "definitely the supply of work and workers is greater than the demand. There are a lot of people out there looking for work, there are people who are working a reduced number of hours, and people who are taking a reduced rate of pay." According to Mr. Mazzeferro "prices have comes down twenty percent, as an average."
Mr. Mazzeferro, reflecting back on the home construction industry on Martha's Vineyard over the past 20 years, remarks that the current situation "... is as bad as it has gotten as far as I can remember" with his business off by double digits as well. The home construction business on Martha's Vineyard is a "series of small businesses" and, Mr. Mazzeferro said," my major concern now is trying to keep my guys busy."
Regardless of the home construction price point, "Mr. Smith" is optimistic about the future of the industry on Martha's Vineyard. "When this is over, the Vineyard will still be here, the beaches will still be here, and people will still want to come here."
