Q & A 9/5/20
- Strong sales but continued issues with material and rising
- Cautiously optimistic
- Steady growth
- 65 closings in Las Cruces
- Who knows? A lot of factors at play here
- I think we can expect to continue to see strong sales for the first half of 2021
- Will reduce spec inventory and concentrate on pre-sales
- Flat with 2020 due to lot shortage
FG Answer: FG is forecasting a similar year to 2020 with SFR in the 950 to 1 million range and our markets in the Southwest performing similar to how they did this year.
What is the sentiment for anticipation for permits to be pulled for next year among other parts of the country?
- Will vary by region
- 25% increase in permits for next year
- Hopefully increasing building activity in our area next year
- I think they will be strong
- We are experiencing material shortages, increased lumber pricing, sick subcontractors, and sick vendors increasing our construction time and material availability
- Up again
FG Answer: FG is forecasting that the country as a whole will perform similar to this year’s pace and our Southwest/West region outperforming the East
What is the lumber outlook through the end of the year? What are the lumber mills doing to get pricing down?
- HUD is working to increase manufacturing so it should get back on track for 2021. Will see rises at beginning of year and flatten out mid to late 2021
- I hope they are doing everything they can
- We need lumber prices to go down. The market is not absorbing major price increases.
- Hopefully pricing will start coming back down. We won’t have a lot of starts in October due to land issues, so are hoping that pricing will be down a bit before we have end of year new starts.
- We’ve only just now seen a leveling of prices, so I can’t say what the mills are doing to keep prices down.
- Lumber outlook is dim, unknown what the mills are doing to curb this
FG Answer: We are seeing some pullback on the lumber market as we move into the fourth quarter. However, if demand meets our forecast for 2021 we could see markets firming up in the first quarter. Unfortunately, the mills have things right where they want them, strong demand, extremely elevated prices and low production. Unless the mills feel like there are risks of a market slow down we don’t anticipate they will increase production to drive down costs. We are forecasting prices to be slightly below the average this year.
- Lack of manufacturing. It’s not a natural product, it’s developed, should have more companies and material options
- For me it’s fear of pushback from buyers if we use something besides OSB
FG Answer: Unfortunately there are not many alternatives for sheathing for walls or decking. While there are a couple of applications like insulated panels the cost makes them prohibitive unless a builder can upsell them.
Q & A 8/5/20
Are other builders seeing significant material/supply shortages? What is the outlook for the next 60 days concerning this?
- YES – material shortages in almost all construction categories
- Yes, lumber will continue to increase in price due to shortages and demand. Lumber yards will see restrictions on delivery amounts. Theft is sky rocketing on lumber.
- Slight delays in material, longer lead times to get doors, windows, appliances, tile
- Appliances and garage doors continue to cause delays
- See some issues, but nothing crazy. Just having to work through a couple of issues.
- Concerned with availability
- Less concerning than last month
- We need to look for alternatives on materials to keep the cost down
- Lumber, windows, brick, appliances
FG Answer: The supply channel continues to experience shortages in multiple product categories including lumber, sheathing, windows, doors, and other construction materials.
FG Answer: We expect to see continued pressure on availability and pricing as we test previous commodity price records.
- Appliances, HVAC, Tile **, Interior Doors, and Windows
- Concrete finishers, plumbers, trim carpenters, painters
- I am seeing delays in concrete, framing, painters and tile layers
- All trades are equally impacted by labor shortage
- Finish trades (trim carpenter, cabinet setter, painting, etc)
- Concrete and stucco
- Concrete, framing, stucco, rock walls
- Drywall, concrete and finish textures
- The trowel trades, cement, stucco, block layers, etc. Severe labor shortage
- Windows, brick
FG Answer: We have some concerns that suppliers and mills are going to slow the momentum in housing as we move into the 3rd quarter.
Q & A 7/6/20
- I hope not
- Maybe on a case by case basis (state or local)
FG Answer: We don’t believe we will see shutdowns in the fall/winter in the states we operate in, however, we do expect to see economic activity affected because of increased infections.
- The election will have something to say about it…but overall, strong.
- cautiously optimistic
- I think if the lumber market doesn’t turn soon it will severely curtail sales as homes will be too expensive to purchase
- Great rest of year ahead with NO more shutdowns
- Interest rates stay down, restaurants will continue to struggle, travel leisure will struggle, home building may slow down to a normal level after surge in demand but record low interest rates, people staying in their home more, using home differently, such as home resort, school for kids, working from home, combined with low inventory will keep demand up thru end of year. After election will determine next year and if a vaccine is found.
- Sale will be up
- Crazy busy until October with the holiday sales pause
- I am very positive 3 QT will be very strong in sales, and more normal 4 QT. Some concern about price increases.
- Looks like we should finish strong.
- Increased production, sales to slow a little due to school. Continued material shortage issues.
FG Answer: In the states that Foxworth-Galbraith operates in, housing should remain firm through the third quarter and into the fourth. However, as we look at 2021 we expect to see a significant softening in housing without a major change in the outbreak (vaccine or diminished infections). Unemployment rates are elevated and we cannot help but believe that a sustained rate in the double digits or high single digits will have to play into the housing market at some point.
Q & A 6/5/20
In Oklahoma, tough to get quartz, steel and certain lumbers. Affecting countertops, closet rods, fencing, etc.
- Appliances and Plumbing
Flooring and appliances supply issues and delays with cabinets and windows
Appliances, Lighting – plumbing fixtures, Rock Veneer.
I am currently not seeing any supply issues with materials.
- Cull lumber. Typical of this time of the year
- Appliances, cementitious siding, door skins
- Kitchen appliances
- Appliances , shower doors, both slow in delivery but no major issues as of now
- It is more products than materials. Fireplaces, light fixtures, appliances, etc.
FG Answer: Supply issues remain on just about everything imported, but is now also affecting some domestically produced goods. The rule of thumb today is to allow for additional lead times.
FG Answer: We expect pricing to ease in the next 4-6 weeks. In the short term, we will continue to see prices on lumber commodities stay firm. See our Industry Update for more details.
Q & A 5/6/20
- Mostly secure
- Sporadic delays, and backorders
- We see some issues in trim, hardware and fixtures
- I feel our supply chain is good at this time
Q & A 4/29/20
- I predict for at least a few months
- I think we are going to see a new normal way of doing business, social distancing for months. But increased sales as people go back to work.
- 12 more months
- Until July
- Still undetermined
FG Answer: We do not believe that housing has begun to feel in the impact of the outbreak or severe unemployment. Our revised forecasts call for housing demand to continue slowing from the pace in the 1st quarter through the rest of the year. We expect to see housing down 20-30% in our markets year over year with a return to positive growth in the middle of the 1st quarter of next year. The key variables we are watching are average weekly unemployment claims, annualized unemployment rates, business and mortgage loan defaults, and GDP (we don’t believe interest rates will be an issue this go around). We expect to see unemployment up 2-4 points over our very low rates before the outbreak. We expect tighter lending restrictions as banks deal with loan defaults and bankruptcies in their portfolio, and we expect GDP to be hard hit for several quarters.
- Prices stable
- I believe that they are flat
- upward movement
FG Answer: Our commodity index is continuing to decline, however, we expect some firming up and slower declines as mills and manufacturers reduce supply. See our pricing index on the Industry Update page for more details.
Q & A 4/22/20
N/A. I am a builder. Glad that the lumber pricing is down though. can really use that for additional promotions
- Most Buyers are paying full price, very little concessions
- 2 of my 3
- Not me
- None yet
- None that I know of
- Yes I have
FG Answer: We haven’t had builders ask for price reductions nor would we anticipate that given that we price off-market and our current inventory positions. The outbreak hasn’t changed that dynamic.
- We are notifying our lenders earlier than normal about closings. We have not experienced any change in lending practices.
- Not sure
- I do not think so
- More than likely
Possibly, rumor is that the wholesale market is concerned about buying mortgages that may not pay.
FG Answer: We have already seen credit standards tightening and we expect that to continue as lenders have exposure to loan defaults and tighten their risk portfolios.
Get some information on how Mexico will come back online. Do they have a timeline? Same for the lumber mills.
We expect to see Mexico plants to begin ramping back up at the end of May however expect to see some supply disruptions by way of delays for the next several weeks. Regarding lumber mills, we continue to see curtailments and production cuts and expect to continue to see supplies restricted to meet an anticipated demand slowdown in housing and continued softness in China purchases. We see continued supply channel disruptions on doors and millwork.
That said, FG is very well positioned on inventory and we see no availability issues as we move into the summer.
Q & A 4/15/20
- Very minor delays
- Plumbing supply house changed to delivery only. Others are asking us to order as early as possible.
- Not yet
- Sporadic shortages on interior doors and countertops
- Mexico shut down facilities. China shut down facilities but have boats on the way, however, ports are not operating at full capacity. Fluctuations of sites being shut down due to exposure and opening up a few days later after disinfecting facility.
- Nothing significant
- Sort of. Interior doors are on backorder. Also heard that an entire cabinet shop had to shut down because someone tested positive.
- Some distributions on certain products Tile, sinks, lights . We have been able to change to other selections
- Not at this time.
- Fireplaces, some interior trim products, some cabinets, light fixtures. All having delays.
- Slight challenge with labor when crews get sick. Manufacturing running a little behind due to smaller crews on shifts.
- No, nothing as of yet
- None yet but they are probably on the horizon
- not at this time
What is the forecast on supply from logistics, shortages, and supply chain disruptions with building materials?
- We have seen some disruption due to positive COVID-19 cases in several factories
- We have seen an impact at this time
- Not if but when.
- Don’t know
- Various manufacturing facilities are being taken down for cleaning weeks at a time due to Covid-19. This will cause shortages at some point in time.
- Right now everything is day-to-day. We foresee some facility shutdowns due to lack of demand. Not sure when Mexico will be back up, could cause shortages later this year.
- flooring is being said to have problems
- Not anticipating any if we get back to business in the next few weeks.
- Unknown. Supposedly ok but if someone gets sick that will take out teams at a time.
- No known issuses
- Gonna get worse before it gets better.
- Forecasting some materials shortages this summer, falling prices (which should help some new sales), and labor stabilization later this year
- Next month issues
- Nothing at this point
- Not at the current time
- Inspections and permitting are on same amount of time as before one month ago.
- not at this time.
- Yes, very slow at the moment
- No inspection are being met.
- Bigger items like plats can be more challenging. Not issue with inspections.
- Cities are still doing inspections. Drop plans off without seeing anyone or online to get permit. Plats are still being filed just slower process.
- Slight delays
- Inspections are fine. Plats being recorded have been greatly delayed
- inspections no, plats yes
- yes on both
Our sales team is still in the models but are working by appointment only. How are other builders handling their models and traffic?
- We are handling in the same manner, by appointment only and virtual walks
- Sales team has been working by appointment only for one month
- We are still meeting with clients personally.
- By appointments only
- working by appt only
- We are moving slightly just moving forward in a safe way
- By apt only, but some are starting to go in more frequently.
- 85% virtual
- We have signs at models offering virtual tours, Virtual meetings , sign documents online , online color selections , zoom Meetings’s for plan reviews
- By appointment only
- Sales people are working from home except for scheduled appointments.
- Our sales team are in the models, models closed to public and by appointment only WITH a wavier signed by buyer, mainly virtual appointments now to keep all safe.
- appointment only
- Model closed; sales meetings by appointment