‘Not a lot left on the bone’ for builders

Norfolk County Mayor Amy Martin.

Luke Edwards

Grant Haven Media

Challenging construction market leaves homebuilders asking for help

The two sides of the ledger are going in the opposite direction to encourage developers to build more homes, a local builder says.

Sam Bunting, owner of Prominent Homes and past president of the Haldimand Norfolk Homebuilders Association, presented to Norfolk councillors at the Oct. 15 council-in-committee meeting, sharing challenges builders are currently facing.

“I feel I’ve done everything I possibly can to provide work for my employees and subcontractors but it’s starting to feel like it may not be enough,” he said.

On the one side, expenses have been increasing on nearly every front. Land prices, materials, and building costs are all up. Government charges like HST and municipal development charges add to that. Bunting said a provincial rebate on HST hasn’t increased in years, even though he’s now paying far more tax on builds.

Meanwhile, buyers aren’t eager to pay the prices Bunting and others need to turn a profit.

“There’s really not a lot left on the bone for our business,” he said.

As a result, subdivisions that have been approved for construction have been left in limbo. 

Bunting sought out council’s help, on behalf of the local homebuilding sector, to come up with ways to make the math work.

“Builders are in a very difficult position within Norfolk County to combat affordability,” he said.

While seeming to sympathize with Bunting’s position, Mayor Amy Martin said the municipality, and more to the point its tax base, may not be in a position to offer the kind of help builders desire. 

She did suggest working with Norfolk’s construction sector, however, to come up with a list of requests and lobbying efforts. Staff can then work with the sector to see where support can be offered, potentially in the form of lobbying.

“Everybody wins when we’re creating some affordable housing but making sure the right level of government is subsidizing the issues, I think, is the priority for me,” she said.

Coun. Kim Huffman asked whether it may require a rethinking of how homebuilding is approached.

“Usually we don’t want to reinvent the wheel but I think we need to reinvent the wheel here,” she said. 

Conventionally new homes and first-time home buyers don’t mix. Instead, new builds are mostly purchased by existing homeowners. Their move, in turn, opens up older homes to first-time buyers.

Huffman wondered if new builds could be designed in a way that’s more accessible for first-time buyers since existing homeowners are becoming more reluctant to part with their longtime homes.

“I think there’s a whole market out there that hasn’t been tapped,” she said.

Bunting poured some cold water on that, saying costs can’t come down enough for it to work.

“It’s almost impossible to get home costs under $600,000 these days,” he said.