WENATCHEE — Entering the Saddle Rock East subdivision that’s taking shape off South Methow Street is almost like going through a time warp back to the pre-recession gravy days of home construction.

Sub contractors carry tools and supplies between new homes and their trucks, and earth-moving equipment is shaping the landscape. The project is full of sights and sounds that were commonplace all over the valley until the home-lending bubble burst and most residential construction ground to a halt.

The sub-division’s developer and contractor, Stimac Construction, is one of the very few brighter spots on the construction scene these days.

Brighter, but still a challenge.

“The margins are slim, but there’s still a little demand if the product is up,” Vince Stimac, company owner, said. “The problem is, with land costs and all the fees the government puts on us, if I build five homes a year, I could not compete.”

Stimac’s building more than 50 homes a year around the Wenatchee Valley. He says volume and a quality product for the $220,000-and-under price is keeping his crews working.

Most can’t say that right now.

“This has been a very protracted downturn in the construction industry and continues to be so,” said Marc Straub, executive officer of the Wenatchee-based North Central Home Builders Association. “From a real on-the-street look, there are very few projects out there and a number of contractors vying for those projects.”

According to data compiled by Pacific Appraisal Associates of Wenatchee, 488 building permits were issued during the construction boom year of 2006 in the greater Wenatchee area. This compares to only 187 last year, a nearly 62 percent decline.

Some contractors have turned to remodeling work and “honey do” jobs to take up some of the slack.

“I’m building a 3,000 square foot custom home in Peshastin right now, but a week ago Friday I replaced a kitchen sink,” said Ed Gardner, owner of EDY Construction.

He says his secret to surviving the recession is personally answering his phone, taking small jobs, and showing up on time.

“Our industry as a whole, construction tradespeople, just seem to be notorious for lack of communication,” he said. “For me, personally, that’s a big deal.”

Gardner’s says he and his four employees are staying busy by looking for big projects, like home additions and remodeling, but filling in lulls in the construction process with smaller jobs — everything from installing a doorbell to trimming weeds.

“I’m not a big contractor. I can’t compete with the older (bigger) guys, but I’m OK being on the “B” list, because I can stay busy,” he said. “Nor do I want to build as many houses as they build. I like being able to do a little of a lot of stuff.”

Can do is built into the name of Gardner’s company — “EDY” stands for “Every Decision is Yours,” he says.

Gardner’s filling a niche, but Straub admits there isn’t “a lot of middle ground,” in the industry right now.

Since the crash, mortgage companies and banks have pulled back on their once free-for-all lending. Buyers have to have a down payment again, and a job, to get a loan.

Jobs have also been hard to come by for many.

“If people aren’t confident, they are far, far less likely to make that leap (to home ownership),” Straub said. “However, what that’s doing, and we’re seeing it here locally, is that there’s pent-up demand. Once the economy does recover, that pent-up demand is going to make itself known.”

With household finances tight and builders eager for work, the “underground economy” of unlicensed and unbonded builders is flourishing, Straub said.

“The consumer thinks they’re getting a great deal until they go down that road and then we end up getting phone calls asking how they can extricate themselves from certain situations that have gone south due to a shady contractor,” he said. “What appears to be a great deal isn’t always a great deal.”

Developer and contractor Jay Bollinger has been in business 66 years and has a list of award-winning work to his credit. He continues to build, despite the recession, but has seen his net margins slip from about 7 to 8 percent during most of his career to just about 2 percent.

He says he’s cut his costs by financing his own projects.

Bollinger’s company is almost finished with a new subdivision at McKittrick Street and Western Avenue. All its homes are sold. The company is also at work on a new development off of Fifth Street and a spec home on Skyline Drive.

“You know, we just keep struggling along,” he said. “We’ll probably have another three years of struggle. People who are unemployed are not buying houses. Everybody still wants to own a home. That hasn’t changed. It’s still the American dream.”

Bollinger echoes Stimac’s concern about new state regulations for energy efficiency that he says could add $6,000 to $8,000 to the price of a $300,000 new home. The regulations require newer styles of furnace and duct systems and other design compensations for designs with large windows — a favorite with buyers.

“What makes anyone think I can raise the price $6,000 to $8,000 and still sell the home? It scares me a little bit,” he said. “It’s probably great for energy savings, but at the same time, I don’t think right now is the best time to implement it.”

Positive energy, not gloom and doom sell houses, he says.

“I think people need to be a little less gloomy and more upbeat if they expect to market their product,” he said. “We need some enthusiasm in this economy.”