Southern Maine homebuilders are on track to build fewer new homes in 2011 than at any time in at least the past 20 years, figures show.

From January through September, builders took out 594 permits in the three dozen communities from Lewiston to Kittery tracked by Construction Data New England. That shatters the recent, record low of 703 new homes started during the period two years ago, in the depths of the recession. By comparison, 1,111 homes were started or built during the first nine months of 2007, just prior to the economic downturn.

The project counts, tallied from building permits by the Windham-based firm for The Portland Press Herald/Maine Sunday Telegram, also show a drop in spending on remodeling and additions. That decline appears to have bottomed out, however, as people unable to buy or build stay put and renovate their existing homes.

Looking ahead, key builders don’t see much changing next year.

The home construction figures and industry outlook is unwelcome news for attempts to lower Maine’s official jobless rate, which has remained stuck near 7.5 percent for the past year. Home building ripples through the economy and generates a wide range of jobs – excavation to roofing, appliance sales to material delivery. But because many contractors are self-employed, and because the so-called multiplier effect in construction spending relies on estimates, labor analysts say a precise job number is hard to establish.

That said, two of the area’s top builders estimate that each home they put up generates 40 to 50 direct jobs – and they are starting only half as many homes now as in the recent past.


“The fact that the housing market (nationally) fell off the cliff speeded along the recession,” said Amanda Rector, Maine’s state economist. “And the fact that it hasn’t recovered contributes to the lack of an overall recovery.”

Housing alone won’t drive Maine’s recovery, she said, but it’s a key component.

Maine’s relatively stable real-estate market cushioned the impact of the housing bust that roiled some states. But spending on new home construction in southern Maine has been slashed since the recession, figures show.

Builders erected 1,410 homes in 2007, at a cost of more than $304 million. They put up only 594 houses in the first nine months of this year, for roughly $123 million. Those numbers will rise by year’s end but are expected to fall short of the current low, set in 2009.

New construction did edge up briefly in 2010. But the activity was short-lived, fed largely by now-expired federal tax incentives for first-time buyers.

John Roberts has watched the numbers play out in the condominium business.


Construction supervisor for Kasprzak Inc. in North Waterboro, Roberts will start 40 new units this year, down from 80 or more during the boom.

Roberts was running three framing crews, with six workers on each crew, during the good years. Now he hires one crew.

“We’re down 12 guys for framing,” he said. “And if I had three framing crews, I’d have more plumbers going.”

Starting at the foundation, Roberts added up the jobs associated with each stage of a new condo unit: His tally included six framers; two plumbers; three insulators; three drywall hangers and three tapers; and two painters. Altogether, 19 people.

Mark Patterson came up with a similar total. Owner of Patco Construction Inc. in Sanford, Patterson expects to build 25 single-family homes this year, down from 53 in 2002.

Patterson is past president of the Maine Homebuilders and Remodelers Association. His national trade group estimates that building 100 new homes generates 305 jobs and $23.1 million in wages and business income.


In Maine, average annual wages in the home-building trades exceed $33,000 a year, according to state data.

But it’s harder to get an firm grip on employment numbers in the trades.

Many workers are self-employed; construction accounts for nearly one-quarter of all self-employment in Maine, the highest of any sector. Another factor: Some workers are paid in cash and don’t report income, or drift into other jobs.

“Guys I used to see on job sites, now they’re working at Lowe’s,” Patterson said.

Officially, Maine Department of Labor figures show that the number of home-building jobs has fallen from a high of 5,723 in 2005, to 3,841 this past June. The decline generally bottomed out early last year.

Another murky part of the picture is the multiplier effect of home building on retail employment, which isn’t captured by labor statistics.


Roger Ginn and his wife brought along much of their old furniture when they moved in August to Kasprzak’s Schooner Landing condominium project in Wells. But they couldn’t stay out of the stores completely. They recently went to Pottery Barn to find bar stools for the kitchen, and Furniture Market to buy seating for the sunporch. Then Ginn’s wife went shopping for window treatments.

“She needs all new curtains,” he said.

But Ginn is an exception today. Most people who want a new house are stymied by declining home values, credit problems or job insecurity. For many owners, renovation is the only option, a trend reflected in the southern Maine statistics.

Additions and renovations valued at more than $15,000 fell from 2,237 in 2007, to 1,750 last year. The total value went from $127 million to $98 million.

For the first nine months of this year, builders and homeowners pulled 1,264 permits, for work valued at $63 million, according to Construction Data New England. Judging from past experience, it’s possible that spending will top the 2010 total by year’s end.

This trend has created opportunities for some businesses, and provided jobs.


“We’re definitely noting a lot more renovating and remodeling,” said Ron Wiles, director of marketing at Hammond Lumber Co.

Additions, decks and garages are popular, Wiles said, as well as energy efficiency upgrades, such as new windows. People staying in their existing homes are updating the kitchen, too, with new cabinets and granite countertops.

With a customer base split evenly between contractors and homeowners, Hammond is focusing on a high level of service to help distinguish it from larger rivals, Wiles said. As some big-box home improvement stores consolidate, Belgrade-based Hammond has been opening new outlets. It now has 400 employees and a dozen stores, including Portland and Brunswick.

The uptick in renovations is good for small contractors, such as Chretien Construction in Saco.

“This year will be one of our best in quite a few years,” said Carl Chretien. “We’re booked through the end of the year.”

Chretien works with a two-person crew. He’s busy with siding projects, bathrooms, roofs and new windows. But Chretien continues to see a volatile, uncertain economy, and he’s reluctant to hire. His caution underscores the challenge of boosting employment through the housing industry.

What would it take to bring on another employee?

“We like to see six months of work out there before we do that,” he said.

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