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With Less Work, Contractors Reinvent Themselves

By Beacon Staff

Craig Stoddard, a three-time winner at the “Flathead Valley Parade of Homes,” was churning out three or four high-end homes a year at the height of the building boom.

Check out his online portfolio at Stoddard Construction and Design Company’s website and you’ll see a list of 4,000-square-foot, million-dollar plus homes with exquisite oak floors, masterfully crafted cabinetry and granite countertops.

This portfolio is a showcase of a builder who reached his prime at the same time the valley’s housing market reached its prime. It was quite a way to make a living.

But as the times change, so do the builders, or they run the risk of going extinct. Stoddard knows this as well as anybody. No longer are the contracts for million-dollar homes pouring into his office.

Today, Stoddard is fortunate enough to still get a job here and there building new houses. He fills in the gaps, however, with remodel jobs. It’s almost as if he’s returned to his roots as a subcontractor more than two decades ago – building extra bedrooms and laundry rooms, but not many houses.

“It’s kind of back to where I started,” Stoddard said. “I’ve seen it over the years, that it goes in cycles. But this one’s been the worst.”

Across the board, from finish carpenters to big-time contractors like Stoddard, folks who make a living in the construction industry have had to adapt to a drastically new market. In some cases, they have totally reinvented themselves.

Others have simply disappeared, forced to pursue other careers. Stoddard said a positive side effect is that people who had simply paid their fee and got their contracting license to capitalize on the boom, without having the proper background, have largely been weeded out.

“The playing field is a little more level and the good people stay and continue to work,” Stoddard said. “Whereas during the last boom we had a tremendous number of contractors moving here or getting their licenses.”

New home starts, as most people in the Flathead Valley know, slowed to a crawl when housing bubble burst and have only slightly picked up the pace in the past year. Homeowners who planned to sell are now holding off, with some choosing to remodel to increase their home’s value while hoping the market will recover.

Other homeowners have no intentions to sell but are now feeling confident enough that the worst of the economic downturn is behind them, allowing them to tackle that list of touch-up jobs at their house. These remodelers are keeping many builders in business.

The upside for Flathead Valley residents is that there are more skilled workers available, Stoddard said. Top subcontractors who used to be scheduled out for months with new houses now have time to take on bathroom remodel jobs and small additions.

“There’s a lot of guys out there who might not have even considered doing a remodel before,” Stoddard said.

One such finish carpenter is Nate Nye, owner of N8 Construction. Nye said much of his business relies on the main contractors. When they’re not getting big jobs, neither is he. So, instead of work coming to him, he’s been pounding the pavement looking for work.

“I’ve had to advertise to the general public and reinvent myself and go to the public and find jobs,” Nye said.

But Nye will only go so far. He said he doesn’t want to simply put his name in the phonebook as a general handyman in hopes of finding any job he can. He has spent years perfecting his trade and, like an artist, he doesn’t want to compromise the finer details of craftsmanship.

“The jack of all trades and master of none – I don’t want to be classified as that,” Nye said.

Even when jobs are available, the competition is so stiff that Nye said a subcontractor needs to be willing to drop his prices – maybe significantly – or else lose the bid.

“Some people are doing it for half of what they used to,” Nye said. “They keep dropping until it eventually comes out to they’re working for free, when you factor in tools and insurance and everything else.”

He added: “The price of diesel and insurance has gone up, but groceries are expensive and my mortgage is still the same. Because construction is slow, everybody expects the subcontractors to drop their prices, but it’s tough.”

Similar to subcontractors, contractors have also had to drop their prices, Stoddard said. But prices can only be cut so much before the quality of work and materials suffers. Not to mention, the subcontractors get dinged too.

“You still want to maintain your quality and you can’t just dramatically drop your price because you have a whole lot of subs and people down the line who can’t afford to do that,” Stoddard said.

The last house Stoddard built is valued at less than $600,000, significantly less than the $1- to $2-million homes he was building before. And while he hasn’t had to begin taking on really small remodel jobs, he’s still not making nearly the same money as he was a few years ago.

“Not even close,” he said. “There’s not as many remodel jobs as there used to be new homes. The remodel business is still really slow too.”

But not all is bad with the housing market’s changing landscape. Jason Gerbozy, owner of construction firm Northwest Residential, said the feverish pace that once dominated both construction sites and the lives of contractors has now slowed to a true Montana rhythm.

“It’s more pleasant,” Gerbozy said. “Everyone’s more eager to pitch in; (subcontractors and employees) are trying to maintain doing business with me and making sure they’re pricing competitively and they’re giving me as much as they can so they maintain my business.

“And in turn I’m able to pass that along to my clients. It comes full circle.”

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