📨 Contractor’s Digest – Daily Rundown📅 Monday, March 10, 2025

🚧 Today’s Rundown

🔹 Housing Market Demand Falls to Record Lows – What It Means for Contractors?
🔹 The #1 Mistake Contractors Make with Change Orders

 🏗️ Feature Story: Housing Market Demand Falls to Record Lows – What It Means for Contractors

📉 What’s Happening?
Pursuant to an article from WolfStreet.com. https://wolfstreet.com/2025/02/27/in-the-south-pending-home-sales-plunge-to-record-low-just-as-inventories-in-florida-texas-balloon-push-us-pending-sales-to-record-low/  

Pending home sales—a key indicator of future closed sales—plunged to a new all-time low in January, according to the National Association of Realtors. The biggest drop came from the South, the largest housing market in the U.S., where inventories are ballooning in states like Florida and Texas.

✅ Pending sales in the South dropped 9.2% month-over-month and 8.8% year-over-year, marking the sharpest decline in the country.
✅ Florida’s active listings surged 34%, and Texas saw a 25% increase, signaling a growing oversupply of homes.
✅ Buyers are holding back as home prices remain elevated and mortgage rates make affordability a challenge.

📌 Why It Matters for Contractors:

💡 Take Action:
✅ Remodelers should market to homeowners who are staying put, focusing on value-adding renovations.
✅ Builders should monitor material & labor costs as demand shifts—price pressure may increase competition for jobs.
✅ Stay ahead of pricing trends to ensure your bids remain competitive without sacrificing profitability.

🔹 The #1 Mistake Contractors Make with Change Orders

Change orders are an inevitable part of construction, but handling them incorrectly can cost you thousands in unpaid work, disputes, and delays.

So what’s the biggest mistake contractors make with change orders?

📌 Failing to Get Them Approved in Writing Before Doing the Work.

Too many contractors rush into extra work based on a verbal agreement with a client or GC, only to face payment disputes later. Without a signed, documented change order, you have no legal leverage if the client refuses to pay.

🚧 Why This is a Costly Mistake

✅ Unapproved work = unpaid work. If the client "forgets" they agreed to the change, you could be stuck covering the cost.
✅ Verbal agreements don’t hold up in disputes. If it’s not signed, it’s your word against theirs.
✅ Change orders protect your schedule & cash flow. Without clear approval, scope creep can eat into profits and delay project timelines.

🛠️ How to Fix It – A Simple Change Order Process

1️⃣ Stop Work Until the Change Order is Signed – No signature, no extra work.
2️⃣ Include Clear Pricing & Timeline Adjustments – Spell out the cost and how it affects the project schedule.
3️⃣ Make It Easy to Sign – Use digital signatures (DocuSign, PandaDoc) to get approvals quickly.
4️⃣ Keep a Paper Trail – Store signed change orders in your project files for easy reference.

🚀 Pro Tip: Include a clause in your contracts that says "No change orders will be performed without written approval." This sets clear expectations upfront.

💡 Take Action This Week

✅ Review your current change order process—is it airtight?
✅ Start using digital change order approvals for faster sign-offs.
✅ Train your team to never start extra work without written approval.

This simple shift will protect your time, profits, and client relationships.

🛠️ Quick Bites

📌 Legal Tip: A clear change order process (signed & documented) prevents disputes. Verbal agreements don’t hold up.
😂 Contractor Humor: "Why don’t plumbers ever play poker? Too many flushes!"

📣 Call to Action

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👷‍♂️ Stay safe, keep building smarter!

— Benjamin Patton