By Jerry Deschane
Contractors, consider this your unofficial “attaboy” on behalf of local governments and property owners across Wisconsin.
During 2012, your work added $4,272,230,300 to the value of Wisconsin real estate. That’s a lot of nails, 2-by-4s and concrete. It’s also a lot of jobs.
The Wisconsin Department of Revenue just released its annual statement of changes in equalized values. The report is the official tally of real estate throughout Wisconsin and includes the value of the increase in real estate because of new construction.
It’s a number geek’s dream. I’ll probably take it to my cabin over the weekend just to play around with the statistics.
On the bad news side, the total value of real estate in Wisconsin declined again last year, down to a total of $467.5 billion from the 2008 high of $514.4 billion. The good news is that most analysts say we’ve seen the last year of decline and that 2013 property values already are increasing.
I think we all can agree that probably is true based on everything that has been taking place in the market during 2013. So, let’s raise a glass to the recession and leave it in 2012.
In case you’re the competitive type, here is the breakdown across the three general categories of property: residential, commercial and manufacturing.
As always, residential construction constitutes the biggest single share of new real estate value. In 2012, homebuilders and remodelers added $2 billion in new property value, while commercial posted a $1.6 billion increase and manufacturing a $0.6 billion increase.
All three categories picked up the pace from 2011, although the residential real estate portion only grew by $100 million from the year before.
Are we back to normal growth levels? Commercial and manufacturing might be, but residential has a lot of ground to recover.
Looking back to 2003 levels, when the market was not too hot and not too cold, there was $7.5 billion worth of new construction value added to Wisconsin. Of that, $5.4 billion was residential, $1.7 billion commercial and $0.26 manufacturing.
Compare that to the 2012 values, and it’s time to say, “Let’s go, homebuilders. It’s time to start pulling Wisconsin’s economic wagon again.”
The construction industry seldom gets recognized for the huge contribution it makes to the state’s economy, for its critical role in fueling economic growth — try growing a business in a tent — and for its ability to create long-term wealth for individuals.
So, in celebration of $4.3 billion in brand new, non-Wall Street, good old Wisconsin value, here’s to you, Mr. and Mrs. builder-carpenter-painter-plumber-landscaper-and-equipment-operator. We’re glad you’re here.