EAGLE POINT — If you don't think time is money, guess again.
Month by month a new house on Stonewater Drive in the north end of town has gone up in price.
Travis Snyder began the final phase of the Sienna Hills subdivision at the start of this year. In March, the 1,700- to 1,800-square-foot houses were selling in the $265,000 to $269,000 range. Today, similar houses at the other end of the street are going for close to $290,000.
The reason has less to do with real estate values than the cost of the materials going into the houses.
"In the past quarter alone, we had hurricanes in Texas, Florida and Puerto Rico," he said. "There's been a huge spike in lumber and commodities across the board. My supplier told me at one point they were literally out of studs. The impact cost from all those things was about 20 percent."
Estimates are all over the place, but suffice to say the property damage from the three hurricanes ran into the hundreds of billions of dollars, putting a nationwide squeeze on building materials seldom seen.
That was followed by California wildfires, which had a monstrous impact.
"Those events were separated by thousands of miles, but there are only so many companies that make materials," said Brad Bennington, executive officer for the Builders Association of Southern Oregon. "There are only so many lumber companies, only so many electrical companies working with wire, plumbing companies, roofing and drywall companies that manufacture materials."
Snyder Creek Development has built 24 houses this year as it moved into the final phases of the 40-lot Sienna Hills subdivision.
"It takes us 90 days to build a house, and we've been closing on one every two-and-a-half weeks," Snyder said. "We can't build them fast enough, there is incredible demand. A lot of retired couples are downsizing but wanted something a little newer. A lot of them are from around here."
But Stonewater Drive prices pale in comparison to projects in Medford, he said, where similar three-bedroom, two-bath houses sell for $330,000 to $340,000.
"I'm 43, and when I started building, a beginner house was less than $100,000," Snyder said.
Snyder and landowner Joe Kellerman are poised to begin another development on 9.5 acres about a quarter-mile from the nearly completed neighborhood.
The 54-unit North Barton subdivision off Barton Road is located on the northern extremity of Eagle Point's urban growth boundary. The project includes 25 condominium lots and 29 single-family residence lots.
The 1,340-square-foot condominiums will be privately owned and eligible for HUD financing, but some will be held back as rentals, Snyder said.
The single-family sites will be similar to the Sienna Hills development, he said, designed for 1,700- to 1,800-square-foot houses.
A man-made pond on the north edge has slowed development as the U.S. Army Corps of Engineers performs a wetlands evaluation.
"We were going to break ground in August," Snyder said. "Now it will be the first of February by the time we get wetland permits and mitigation, before we start pushing dirt."
The land had been on track for development prior to the real estate bubble and credit crunch that precipitated the Great Recession.
"We knew from that there were some issues, but didn't know the extent," he said.
To meet wetlands mitigation requirements, it will cost another $300,000 for permitting and engineering, tacking on another $5,500 per unit.
At this point, there is a 30-day notification period allowing neighbors to bring up issues they may have.
"If no one brings up concerns, we go right to permitting," Snyder said.
When developers deal with wetlands — natural or man-made — they are required to acquire state-selected property that will forever remain wetland.
"I have to pay the owner to move the mitigation from here to there, and that's usually about $180,000 per acre," Snyder said.
The mitigation property has yet to be determined, he said.
"You're not going to find any new housing for less than what Travis is building it for," Bennington said. "What's pushing the market is not profit, it's being pushed by regulatory costs."
— Reach reporter Greg Stiles at 541-776-4463 or firstname.lastname@example.org. Follow him on Twitter at www.twitter.com/GregMTBusiness or www.facebook.com/greg.stiles.31.