Builder/Housing Recovery Still Years Away

Builders gathering at the nation's largest regional housing trade show this week were told they'd have to hang on for a few more years before the market picks up any kind of steam. Eventually, builders will produce 1.4 million units a year, but that's "three or four years down the road," said Elliott Pollack, a Phoenix investor and consultant. Speaking at the Pacific Coast Builders Conference in San Francisco he noted, "There's going to be a recovery, but it's going to be a weak recovery." David Crowe, chief economist at the National Association of Home Builders, said patience will be "a builder's best virtue" going forward. But he also said the states which will recover first are relatively small ones. "North Dakota can double its production and we're not going to feel it at the national level," he said. Kicking off PCBC's new Capital Markets Forum, Pollack told builders not to get caught up in numbers. "Things are going to get progressively better, capital will show up and there will be less competition," he said, noting that the number of builders operating in the Phoenix area has dropped from 864 at the height of the market to 133 today. "If I'm you, I'm doing cartwheels because I'm still here," he told the crowd. Pollack, who heads Elliott D. Pollack & Co., also predicted that house prices will jump once the oversupply of building lots is worked off. But he warned that credit for both builders and their buyers will be tougher to come by. "If you want to know what credit is going to look like, go back to the '70s and '80s," he said.