Despite the local collapse in the construction industry, one developer is maintaining optimism with a new spec housing project in University Heights.
The news is a relief to many who believed planned for neighbourhood would remain undeveloped after landowner Doug Day said he was abandoning the 25-home project due to the increasingly unprofitable industry.
In April, Day said the Harmonized Sales Tax (HST) was the last straw. With its implementation and other taxes, he said, homebuilders and land developers would see a $20,000 profit on a $725,000.
"We are voting with our feet and cancelling what was to be a very nice project of 25 new affordably-priced homes at our University Heights master planned community," he said in a strongly-worded email to media, industry colleagues and Mayor Greg Gardner last April.
However Day's son Peter -also a developer - has an entirely different take on the situation. So much so that he bought his father's land and now intends to build on it himself.
"Turns out you end up getting a bit of a rebate from the HST," said Peter Day when asked where their thoughts diverged. "And my dad's not the one who's building the houses, so..."
He said the rebate doesn't get the builder the whole seven per cent back, but it's "better than nothing."
Day and Lee Nystrom of Nykon Services now claim to be the only development company in Squamish building houses on speculation. And the District of Squamish acknowledged the company's gamble by attending an official soil turning ceremony on Thursday, June 17.
Despite the economic downturn, Day remains confident his homes will sell.
"We slowly want to get something going on here," he said.
"I'm pretty confident with the price range that we're aiming at, around $700,000. Most of the other house in the area are more expensive but we're going for a smaller size."
Day said it's also possible to use the market downturn as an advantage.
"We can keep the buying cost lower because the cost of construction right now is a little lower than it was a couple years ago with not much development going on."
And with the pervasiveness of liens being placed on developments still owing contractors, Day pointed out his company's strategy is based on "responsible development," which includes paying his contractors on a monthly basis and only having four houses on the market at any given time.
"The first houses that we're doing are going to be ready in December," he said. "We'll wait until they sell before continuing.
"We don't want to have too many on the market, four is out max that's we'd be sitting on and if a couple are sold while we're building then we'll just keep starting, we'll always have four unsold on the go."
Day said this way everyone gets paid.
"Financially, we won't get in too much trouble as opposed to if we had 10 on the go and 10 of them didn't sell then the question would be would we have money to pay everyone. At least this way everyone can get paid even if they don't sell."
Nykon Services hires mostly local trades and only goes outside Squamish for specific materials.
"We've been hiring locally for seven years," said Day. "With so many trades guys around, why wouldn't we?"
