What a strange time we live in. How can a bug from a bat in China shut down the world? Everything is going great, then wham, the wheels fall off our cart. It begs a lot of questions like: How in the world did this happen? How long will it last? Will I survive? What will the new normal look like? These are the questions and thoughts on everyone’s minds.
Those of us in the Home Building industry tend to have a take charge, I can fix any problem if you just get out of my way personality. That is a wonderful trait until circumstances arise that are completely out of our control and there is nothing you can to do fix things. That is when we become frustrated, anxious and feel powerless.
One benefit of being a Home Builder a long time is knowing that challenging times are always lurking around the next corner. Some events we can see coming. Others, like Covid-19, completely blindside us. Those of us in the building industry are resilient and we have survived challenges in the past. In my own career I have survived the 80’s credit tightening with 17% mortgage rates, the Oil Bust, the S&L crisis and credit crunch, the .Com bubble bursting, 9-11 and the Great Recession. Those of us in the industry around for those crises, persevered by staying calm and knowing that the bad times will end and good times will return.
You get through the tough economic times with great communications with your customers, your suppliers, subs and most of all your bankers. You have to be flexible, innovative and willing to accept the new norm, whatever that may be. It’s also important to support the Home Builders Association, especially during a crisis. It is the Association on a Local, State and National level that brings the collective strength and influence of all of us to bear on decisions made about our industry.
I saw this first hand during my tenure on the National Association of Home Builders leadership team. During the boom before the financial meltdown, new home production topped 2 million units in 2007. It dropped to 400,000 units in 2009, the year I was Chairman. Even though we saw the problems looming, no one knew the depth of the slide we would endure. Everyone was asking the same questions we are today: How did this happen? Will I survive? How long will it last? What will the new normal be? Through the constant conversations with the new Obama administration, bank regulators, legislative leaders and the Federal Reserve, we were able to put together two stimulus packages in the same year, save the mortgage market and set the stage for a recovery. The Local and State Associations throughout the Federation did their part as well. It was hard. The recovery took longer than anyone wanted. A new norm was established in mortgage lending, construction loans and appraisals. But we not only survived, we flourished in the last few years.
Now we meet our next challenge, Covid-19. This is certainly an event no one saw coming. The frustrating part of this episode is that it not only affects the health of our business but it can literally be lethal to our physical health as well. Again, our Association has been on the forefront in keeping our industry alive. Our leaders here in Tulsa and Oklahoma convinced our Mayors and Governor to designate home building an essential business. NAHB is working tirelessly to keep credit markets liquid and was successful in removing the exemption of home builders from the Payroll Protection Program.
When you are in the middle of a storm, it is hard to remember the sun is still shining. Going into this crisis, business was very good. That momentum should help us bridge the downturn on the short term. Long term, the world has to go back to work. President Trump announced his initial guidelines for restarting the economy. Governor Stitt has put a task force together to reopen the State. The Mayors of the area cities are convening working groups to plan for the rebooting of business. Reports of treatments of the virus are encouraging and it seems the number of cases has hit its peak. There are a few hints of sunshine.
I know we will get through this just like we have done in the past. People will always need homes and I can think of no other profession that brings more joy than providing the American Dream. In the meantime, if you are not too busy, take time to reconnect with family, reflect on priorities, and pray.
God Bless Everyone,