Building, renovating projects picking up

The recession may not be over, but people are beginning to spend money on building or improving properties in Laguna.

Permits issued by the Community Development Department’s Building Division more than doubled in February over January of this year and were 50% higher than February 2009. The cost of construction of the permitted projects was estimated to be $63,000 higher than the previous month, but the total valuation increased by about $5 million.

“The dollar figures have nothing to do with the actual cost of construction or the value: They are used to calculate city fees,” said building official John Gustafson. “However, if the numbers are up, there is more construction going on. It probably means there is more work going on than last year.”

January was dismal both years. Although one less permit was issued this January — 103 to 104 — the estimated cost of construction plummeted from $6.7 million in 2009 to $2 million.

February 2010 numbers were a ray of sunshine compared to 2009 or to January of this year.

“This is probably a reflection of the improvement in the real estate market here,” Realtor Gayle Waite said. “We have seen an 11% price increase. The number of sales has increased and financing is improving.

“People are feeling more optimistic and willing to take chances to improve things.”

Designer-builder Gregg Abel said confidence is growing and people are taking advantage of bids that are coming in about 30% lower than in boom times as contractors compete for jobs.

“We take everything, just to send guys out to fix a fence for wages,” Abel said. “We try to help out others that aren’t doing so well, but I see a definite improvement.”

Local contractor Mike Morris isn’t so sanguine. He thinks Mother Nature may have played a part in the increase in building permits.

“Things happened this year with the rain and wind storms and people were forced to do stuff,” said Morris, owner of J. M. Morris Construction. “But people are still cautious about spending money and I know a lot of contractors who are hurting.”

In February, 140 permits were issued compared with 83 in the same month last year and 37 more than January 2009. The big difference was the number of permits reissued: 26 in February, 11 in January.

Permits are reissued for projects that either were not started or not completed in the time allotted by the original permit. Reissues differ from extensions which are granted before permits expire.

The estimated cost of construction for the purpose of determining fees for permits issued in February was more than $4 million, with a total valuation of more than $6 million, based on the formula of $203-per-square-foot the city uses to compute the fees for such services as plan checks, Gustafson said.

Two permits were issued for new single-family residences, with a valuation of $2.3 million, and one detached garage. The next highest valuation was $997,000 for 45 permits issued for alterations, additions or repairs to dwellings, almost $300,000 more than in January.

The number of permits issued for commercial or non-residential improvements was two more than in January, but the valuation dropped about $60,000.

Five people paid fees to repair or add to their decks.

A total of 70 miscellaneous permits were posted in February — almost doubling January issues. Projects included re-roofing, fire prevention, the reissues and “other.” Two demolition permits were issued.

No dwellings were completed in January, according to the monthly report by the Building Division of the Community Development Department, but three were finished in February. A 1,600 square-foot, single-family home and 357-foot garage was demolished.

The division provides reports enumerating the permits issued in a given month and for the year, comparison with the previous year, as well at the estimated cost of construction and valuation.