Monday, January 08, 2007

Builders in trouble?

This morning I was doing some research on new home construction in Centre County when I stumbled across another article relating to the Florida building business. The only reason I mention this in my blog is that it supports my recent blog post relating to builders and developers carrying a substantially greater share of infrastructure costs in Florida. Read the post titled, "Who pays this tax anyway?" on December 30, 2006.

The builder states in the latest news release that 218 employees will be FIRED (layoff would be the politically correct term) between Feb. 16 and March 1, 2007. Merry Christmas to all - they were told on December 18, 2006. The builder "trimmed" 135 jobs on November 15, 2006. The company blamed the downturn in housing construction as new construction homes wallow on the market for months.

I wonder how much government regulation has impacted the sales of new construction housing? A billion dollars in new government regulations paid directly by builders must impact the costs (increasing them) to builders that are passed on to consumers in the form of higher prices. The higher prices slow demand because potential buyers may buy a resale at a lower price rather than buy the new higher priced home. Or trade-up buyers don't trade up and stay in their homes for additional years.

The losers? Employees of the builders and developers that lose jobs because builders and developers are not charity operations. I'm sure the employees sent packing have no idea their local elected officials have impacted their lives in this manner.

The good news is that government can take the "savings" they have realized from infrastructure taxes and use the money to keep the FIRED employees afloat while they search for new jobs in the state.

So, again I ask, "Who pays this tax anyway?" And now we know that empoyee's of builders "pay" this tax as well.

1 comment:

workhard said...

You have a very interesting blog.. Will definitely return to read more..

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