Advice for Survival

Bad news is everywhere these days; Builder confidence is down to its lowest level in more than 15 years, home sales are slow, inventories are up and foreclosures are mounting. How can builders and architects stay in business?

The National Association of Home Builders was wondering the same thing when it recently held a panel discussion on the subject. The panel consisted of veteran builders who have been through tough times in the past, including the early 1980s and again in the 1990s.

The veterans’ survival advice included knowing your clients’ closing capabilities, suggesting sometimes it’s better to not build at all. Know your buyers, said one builder who approached closing only to learn the buyers were skittish investors. They also suggested keeping tabs on competitors’ price discounts.

Assume that not everyone will be able to pay you, so make provisions to accommodate this dilemma. And make sure you pay your bills to avoid liens, they advised.

A third-generation builder said it was his father’s advice during the 1990s that allowed him to stay afloat back then. His point was to seek out and heed the advice of seasoned builders who have survived downturns, and learn from their experiences.
Another survival tactic is diversifying into, for example, remodeling work or storage facilities. Make sure your work stands out from competitors, and deliver what home buyers want. A recent American Institute of Architects survey reveals homeowners are increasingly concerned with utility and energy costs, raising demand for energy-efficient solutions and greater popularity of home offices.

In high demand are such products as structural insulated panels, geothermal heating/cooling systems, tankless water heaters, synthetic/engineered or reclaimed/salvaged products, products that save water or improve indoor air quality, and green flooring products such as bamboo and cork, said the AIA’s Kermit Baker, PhD. A separate AIA poll revealed 91 percent of registered voters would be willing to pay $5,000 more for a home that uses less energy.

The most popular rooms in a home, according to the AIA survey, are home offices, hobby/game rooms, media/home theaters, exercise/fitness rooms, au-pair/in-law suites and children’s wing/guest wing.

Include green products and features in the homes you design and build and you’ll not only satisfy consumer demand, you’ll differentiate yourself from competitors. For more insight on green design and products, flip through the pages of this issue for stories about mainstream green design, maximizing daylight, the benefits of radiant heating and improvements in the technology and design of solar power products.