Local builders enjoy healthy market despite national recession

Local residential builders are not as affected by the downturn in the economy as some other regions of the country, according to Tim Lacey, president and co-owner of Lacey Brothers Construc-tion Inc.

"The market for spec homes has slowed a little bit, but not as much as I expected," Lacey said.

Lacey noted that the Springfield area does not experience the peaks and valleys that some areas of the country do, because the Ozarks has a diversified employment base and is not de-pendent on just one in-dustry.

Lacey and his brother, Tom, primarily build spec homes ranging from $89,000 to $250,000. The company builds in Springfield, Ozark, Republic, Battlefield and Nixa.

At present, the brothers are working on phase III in Evergreen subdivision, which is off Cox Road, south of Repub-lic Road.

Lacey said they have two homes sold and two more under contract in the final phase of the subdivision.

The company is not going to be de-terred by the sluggish economy, according to Lacey. Once Evergreen III is completed, they will look for another location.

Terry Ozborn, owner of Ozborn Homes, indicated the crunch has affected him personally in that he is more conscious of his business decisions and he has slowed down the spec home portion of his operation.

Last year Ozborn had to hold a house long enough to tie up $60,000 in interest on it.

He does not want to get caught in that bind again.

Ozborn, who builds in the $250,000 to $1.5 million range, stated he typically has had three large spec homes under construction at one time. He has switched to exclusively building custom homes for the time being.

Of the economy in general, Ozborn said, "You can analyze it in several ways and still be right. I think all of us are just guessing right now."

Ozborn noted that the building industry has been good in this area for the past 15 to 20 years.

"This is the biggest downturn we've had in all those years, and it is still a good market," he said. He added that while he did not want to minimize the tragedy of Sept. 11, it only had a ripple effect, economically speaking, in this re-gion. Lacey agreed that the Sept. 11 attacks had a brief economic impact but no long-term ramifications in southwest Missouri.

There has been no effect on the supply line, and pricing on lumber and other materials has remained level, Lacey said.

Scott Rookstool, president and owner of Integrity Homes, said his business has not been affected at all.

Rookstool builds homes in the $350,000 to $500,000 range, with only 25 percent of his business devoted to custom housing and the remainder in spec homes.

He believes selection and location play a part in the success of his company. Rookstool builds in Rivercut and Stone Meadow subdivisions.

"I've been fortunate and blessed to find buyers for my homes," Rookstool said.

Interest rates

Lacey and Ozborn both feel the favorable interest rates have helped keep the market strong in this area. Rookstool doesn't believe the interest rate is a major factor in the price of homes he builds.

Many of Rookstool's buyers are coming from other regions of the country and have enough money to pay cash or at least make a sizable down payment.

"People are conscious of rate but not deterred by it," he said.

Lacey said that some houses in his inventory have stayed on the market about a month longer than usual, but that he and his brother have stayed pretty busy this winter and expect to continue.

"Some say the first half of the new year might be tough, but who's to really say?" he said.

And although he's adjusted his ap-proach, Ozborn remains optimistic.

"It's all a matter of attitude," he said. "If we're convinced it's good, it will be good."

Construction loans

Demand for construction loans have tapered off, but the area is still growing, according to John Himmel, vice chairman of Commerce Bank.

Himmel said the Springfield region has seen a slight slow-down in activity, probably due to consumer confidence in the national economy rather than any local recession impact.

"We've seen no increase in delinquencies or defaults in construction," he said.

Himmel reiterated the builders' opinions that Springfield has a good local economy that, because of diversity, is somewhat insulated from the national recession.