Small businesses feel the pinch from slowing housing market

NEW YORK (AP) — The chill in the housing market is rippling out to the carpenters, landscapers and other small businesses that lose out when fewer homeowners are renovating their properties.

Inflation was already causing some homeowners to delay big renovation projects as prices for building materials, fixtures and appliances jumped. More recently, higher mortgage rates have put a damper on the number of homes being sold.

At the beginning of the year, carpenter Bill Albritton, who has owned Albritton Custom Carpentry near Charlotte, N.C., since 2004, was booked months in advance and completing full custom kitchen cabinet replacements in homes in the historic districts of Charlotte. But he’s seen a slowdown over the past two months.

In the Charlotte metropolitan area, the number of home sold fell 19% between June and July, and are down about 21% from July a year ago, according to the Re/Max monthly National Housing Report.

Albritton is booked out 30 days in advance, compared to the usual 90 to 160 days. Meanwhile, his costs have gone up by more than 30% across the board. Plywood he uses jumped from $72 to $140 a sheet around Christmas. It has gone back down to $85 a sheet, but that’s still higher than it used to be. And he has trouble finding hinges at any price.

Albritton is trying to pivot to smaller carpentry jobs.

“Instead of doing new kitchens we’re gearing up to do what we call ‘kitchen face lifts,’” Albritton said. That means just replacing the fronts of cabinets and drawers and teaming up with a painting contractor to paint the cabinets. It gives “a new kitchen look for a fraction of the price,” he said.

The Federal Reserve has been raising interest rates in an effort to reduce inflation, which is running at almost 10% annually at the wholesale level. The fear...