Nancy Sarnoff chronicles the decline of Houston homebuilder David Powers Homes:
David Powers Homes has moved out of its offices on Westheimer and the Beltway and is now operating out of a model home in Lakes of Bella Terra, a subdivision in Richmond.
The company’s staff — 120 people at its peak — has dwindled to just four or five.
The high-end builder is now trying to finish the 36 homes it has in various stages of construction. . . .
Given the company’s higher home prices, about 50 percent of its customers financed their purchases with two loans to keep from paying higher interest rates on jumbo loans.
Those are loans that exceed $417,000.
Many of those second mortgages, Powers said, were subprime.
- Recession takes its toll on another builder [Houston Chronicle, via Swamplot inbox]
Image: David Powers Homes
look there are business cycles. this is a down cycle. powers had a good run and i hope he takes care of his employees. builders need to set up their business with the understanding that the rainy day will come and make appropriate plans. some have done this and some haven’t. there will always be the young recent grad who worked for one of these builders who will probably be the next big builder in the houston metroplex. that is business.