1 | Compete with the public builders on price.
Profit? How passé! Over their past two fiscal years, the top 15 public builders lost an aggregate $12.8 billion on revenue that plummeted by nearly 40 percent to $24.7 billion. But that hasn’t stopped them from buying more land, building more houses, and slashing prices to goose sales. Thanks to the federal government’s net-operating-loss handout, the publics can worry less about making money awhile longer. With the playing field this lopsided, smaller builders must approach customers from different angles, such as design and location. Keep in mind, too, that some publics are already targeting two fertile areas by focusing on scaled-down and energy-efficient homes.—J. Caulfield
2 | Get into an arms race with gables and façade details.
If you’re looking to outshine the competition with curb appeal, think about paint colors first. “Remember that color is the least expensive material with which to create the most impact,” says architect Aram Bassenian, “as opposed to junking up the elevations with extra ornamentation that costs more and doesn’t necessarily work.”—J.S.
3 | Switch subs and suppliers for the lowest bid.
Do you like it when home buyers shop around for the lowest price, regardless of quality or service? Work with your top subs and suppliers to negotiate better (yet still fair) prices that help keep everyone working above the break-even line. Let them know you aren’t shopping their bids, and they might sharpen their pencils in return for your loyalty and steady work.—R. Binsacca
4 | Overlook lot orientation.
For expediency’s sake, builders most often orient their lots based on the street grid. But the truth is that the single biggest move you can make toward energy efficiency is to orient your house for maximum benefit based on the sun and the breeze. Taking advantage of prevailing breezes promotes natural cooling, helps to cut down on heat gain, reduces the work on mechanical systems, and helps save energy. And site orientation “has a crucial role in future performance of the building and enjoyment of occupants,” the Austin Energy Green Building program says in its Sustainability Source Book.—N. F. Maynard
5 | Expand without reconnaissance.
It ducked The Great Depression II, but the housing industry is still marching through The Great Evacuation, with builders exiting markets that looked promising only a few years ago. (Woodside Homes’ decision to leave Washington, D.C., and four markets in Florida, only six years after entering them, is a recent example of this.) Much of the mistimed growth that buried numerous builders over the past five years occurred without much thought given to necessity. If you can’t answer the question “why,” objectively and quantitatively, from the vantage of customers in the market you covet, stay home.—J.C.
6 | Estimate lazily.
The average lumber takeoff for a 2,500-square-foot house is about $15,000, and 15 percent of that (or $2,250) is commonly added as a “waste factor” built in to accommodate miscuts and shorts caused by vague (or nonexistent) framing layouts and poor site supervision. Tighten your estimating with better framing details and work with your lumber dealer to optimize your frame packages to reduce your waste factor to 5 percent or less. Apply the same discipline to sheathing, drywall, interior trim, and siding to reduce the “lazy tax” of those hard costs, too.—R.B.
