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Builders Rush to Complete Houses by U.S. Tax Credit Deadline

By Kathleen M. Howley

June 11 (Bloomberg) — Construction crews for LGI Homes begin work at 4 a.m., pouring concrete slabs for houses before the heat of a Texas day. They don’t stop until 6 p.m., and usually work six days a week.

U.S. builders such as LGI Homes are on a tight deadline to finish houses by the end of June so purchasers can get a federal tax credit of as much as $8,000. Buyers had to sign a contract by April 30 and must complete the transaction by July 1 to qualify. That’s speeding up a construction process that for some builders can take five to six months.

“We have people we need to get closed by the end of the month,” said Eric Lipar, 39, chief executive officer of Conroe, Texas-based LGI Homes. “There is a sense of urgency.”

Senate Majority Leader Harry Reid proposed a three-month deadline extension yesterday amid concern that a rush of buyers created too big of a backlog. New-home contracts rose 30 percent in March and 15 percent in April, the biggest two-month gain in records dating to 1963, according to the Commerce Department. About a third of the April signings were for homes under construction, and a quarter were for those that weren’t started.

Waiting to see if a new home will be finished by the credit deadline can be nerve-racking for buyers, said Charlie Li, a civil engineer in Kansas City, Missouri, who is purchasing a property in the nearby suburb of Overland Park, Kansas. Li drives by the building site every day after work. The four- bedroom house probably will be finished in two weeks, he said.

Read entire story at:
http://www.bloomberg.com/apps/news?pid=20601109&sid=akZGcJglxUaY&pos=12

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