Each day Kelly Greco says a little prayer.
“I say ‘Lord, I gave you this business, it’s been yours since the beginning. I leave it up to you,’ ” Greco said. “It’s been our faith that’s kept us sustained.”
Greco is the founder of Stands Under the Son, a Schenectady-based countertop manufacturer. He and his wife Sherill started the business as a Bible stand manufacturer but the enterprise quickly evolved into countertops during the 2000-06 housing boom.
During the boom, Stands Under the Son benefitted from surging new housing construction and rising home values. The couple maintained two full-time employees and operated their business in the black.
“We had grown progressively every year. This past year was the first we didn’t grow since 2000,” Sherill said.
Now the two employees are gone. The Grecos and their son Heath, a partner, are working hard to stay alive.
“We knew how things were going at Christmastime. We’re usually really, really busy, and we weren’t,” Sherill said.
According to a report released Monday by the Greater Capital Association of Realtors, the sale of single-family homes regionwide in February plunged 29 percent to 431, compared with a year earlier, but during the same period the region’s median sale price jumped 8 percent to $189,900.
Kelly said homeowners have stopped using the equity in their homes to pay to hire Stands Under the Son to build new countertops for remodeling efforts, even if the paper value of a house has note eroded.
Earlier this month, the Federal Reserve reported that the amount of debt tied up in American homes now exceeds the equity homeowners have built for the first time since the Fed began tracking that data in 1945.
Economy.com estimates 8.8 million homeowners, or about 10 percent of homes, will have zero or negative equity by the end of the month.
Kelly said Stands Under the Son is surviving now because of the owners’ faith in God and because its business practices ran directly counter to the housing trends that built it up. Stands Under the Son owns the 1,200-square-foot office and shop space it operates out of on O’Dell Street in its entirety. Without rent or mortgage to pay, the business only has to cover utilities and taxes.
“We’ve operated in the black. If we were to cash out tomorrow, if everybody paid their bills, we wouldn’t owe a nickel to anybody,” Kelly said.
That’s exactly what he did with his first countertop business, Craft-Tech, which he sold to Homecrest Cabinetry in the early 1990s after the housing bubble of the late 1980s burst. He said he expects the glut of foreclosed properties will stymie new housing starts until they have been repurchased.
Earlier this month, the Mortgage Bankers Association said foreclosures hit an all-time high in the final quarter of last year. And pending U.S. home sales — those in the gap between when a buyer signs a contract and when the deal closes — came in below analyst expectations for January and remained at the second-lowest reading on record.
Kelly said his many years of working in the home building and home improvement industry have taught him that prosperity and lean years come in cycles.
“I don’t think you’ll see any kind of recovery until the end of next year. And I don’t think you’ll see any growth until the start of the year after that,” he said.
And new homes may shrink, Kelly predicts.
“You’re going to see restructuring of the type of houses that are built. [During the housing boom] people had gotten these big eyeballs and thought they could live in the lap of luxury, when they couldn’t afford it, and that’s because the prime lenders had sold them that package,” he said. “I think people are going to have to [contemplate] downsizing the size of their house.”
Sherill said Stands Under the Son has now sought out less expensive countertop products and put in bids for new apartment complex jobs.
“We just found another solid surface that we can sell for considerably less,” she said. “I think what’s going to help us is if people have to give up their homes they’re going to go into apartments. They’re going to be building a lot of new apartment complexes that will need work.”
Kelly said Stands Under the Son is bidding to do work on a new apartment complex going up near the Luther Forest Technology Campus in Malta. He said the building would have 900 units.
“That would be sustainable work for us for a couple of years,” he said.
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