Florida’s New Homes Face Delays and Cost Increases Amid Labor and Material Shortages
Published Date: August 17, 2024
Construction companies across southern Florida are grappling with a challenging situation as they try to meet the surging demand for new homes. A combination of factors, including a labor shortage and material scarcity, is causing delays in completing housing projects and driving up prices from Palm Beach County to the Treasure Coast and beyond.
Impact of Labor Shortage
Juan Moya, CEO of Garcia and Sons Construction in Port St. Lucie, has witnessed the increased demand for new homes but is struggling to find enough skilled workers to meet it. Skilled laborers are in short supply, and this scarcity is impacting the pace of construction. The recent exodus of undocumented workers, partly influenced by Florida Governor Ron DeSantis’ signing of Senate Bill 1718, has disrupted industries like roofing, landscaping, and tiling, where many Hispanic workers were employed.
Material Shortages
In addition to the labor shortage, construction companies are contending with material shortages. These shortages have persisted, causing delays in completing projects. Some large jobs have been affected as materials became more expensive and scarce.
The Home Builders and Contractors Association of Florida’s Space Coast reports that the combined labor and construction material shortage significantly prolongs construction timelines. Homes that used to take 12 months to build now require 15 months or more, resulting in new home prices increasing by 20% or more.
Coping Strategies
Construction companies have had to raise their prices to cope with these challenges. Moya mentioned that his company has increased prices by 30% to 60% to offset insurance costs associated with delayed projects, rising material costs, and higher salaries required to attract and retain skilled workers.
Despite the challenges, Moya remains optimistic and emphasizes transparency with clients regarding price increases. They acknowledge that external factors test the construction industry’s resilience, but they are adapting to the changing landscape. Additionally, interest rate hikes have helped control the inflation of materials, providing some relief to the construction industry.
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