Note: The Beacon blog for Nashville-area home builders appears on the second Saturday of each month. Read all the blogs here.
The COVID-19 crisis has dealt a body blow to the U.S. economy.
Home buyers are in financial distress. About 1 in 5 Americans, or 26.5 million people, are out of work.
Even for people who have a job, it’s hard to get a mortgage. That’s because banks are tightening lending standards. They require a 20% down payment and a credit score of 700 or more, NBC News reports.
As a result, home builders’ confidence dropped from 72 in March to only 30 in April. It’s the largest drop ever in the NAHB/Wells Fargo Housing Market Index (HMI).
No matter how you cut it, home builders and contractors face hard times. Even though many other businesses are closed, construction is running as an essential business.
3 Ideas to Help You Adapt to COVID-19
Home builders who thrive during and after this crisis will focus on 3 things:
- Keeping people healthy.
- Assuring a safe workplace.
- Finding a steady source of financing for future projects.
1. Keep People Healthy
Make sure your employees and contractors know the symptoms of COVID-19.
Insist that they can call in sick if they detect any COVID-19 symptoms such as coughing, fever, shortness of breath, difficulty breathing, chills, body aches, sore throat, headache, diarrhea, nausea/vomiting, and runny nose.
Get familiar with the National Association of Home Builders (NAHB) recommendations for COVID-19. Adopt and follow these recommendations immediately.
2. Make Job Sites Safe
During COVID-19, it takes extra effort to make job sites safer. Use this handy checklist:
- Ask anyone showing symptoms to leave the job site and go home.
- Sanitize work areas on arrival, throughout the workday, and immediately before departure with a disinfectant.
- Limit in-person meetings. Conduct safety meetings by phone.
- Enforce social distancing of at least 6 feet between people at job sites.
- Divide your team into 2 or more crews so projects can continue if 1 crew falls ill.
- Do not pass around mobile devices or forms to sign.
- Avoid sharing tools, trucks or equipment. If you must share, disinfect with alcohol wipes between users.
- Stagger breaks and lunches to limit the size of crew gatherings.
- Have employees bring personal water bottles to the job site.
- In addition to the usual personal protection equipment (PPE), provide gloves and eye protection for each worker. Don’t allow sharing of PPE between workers.
- Screen all visitors to job sites for possible COVID-19 symptoms.
Here’s a complete list of the NAHB recommendations for job sites.
3. Line Up a Steady Source of Financing for Future Projects
Since banks and institutional lenders have tightened mortgage standards, you may need alternative financing.
Consider financing from private money lenders such as Beacon Enterprises LLC. We focus on building opportunities for you by rebuilding communities.
Beacon Enterprises LLC plans to do 12 projects, with a focus on the Nashville area, in the year ahead. When you find a property that needs rehab work and it holds good potential as a fix-and-flip project, call Beacon to get funding fast.
Beacon offers up to 100% financing of acquisition, rehab and closing costs on qualifying loans. Need a loan? Apply here.