Last year, nearly 30 percent of new homes in the U.S. had partial or full basements, according to the Census Bureau’s Survey of Construction.
Highlights and Insights from the 2009 International Builders’ Show
Here’s a list of notable highlights and valuable takeaways our editors gathered from the 2009 International Builders' Show.
Editors from Professional Builder and Professional Remodeler magazines were on hand at the 2009 International Builders’ Show to learn, check out new products and network with the home builder and remodeler crowd. The reported 60,000 building industry professionals attending this year represents about a 30 percent decrease from the 2008 show. Nonetheless, there were 1,600 companies exhibiting products and services and more than 250 education sessions featured at this year’s show in Las Vegas.
Here’s a list of notable highlights and valuable takeaways our editors gathered:
- Home automation products are doing well. Lifeware, HAI, On-Q/Legrand and others had extensive booths. We noticed a trend toward blending the fixtures into the décor.
- There’s a definitive shift toward efficiency in manufacturing and job-site delivery, particularly between lumber suppliers, structural product manufacturers and architects. Case in point: the partnership with iLevel by Weyerhaeuser and Cadsoft.
- Anecdotally speaking, decking companies, particularly composite deck brands, have gone to great lengths to differentiate themselves from their competition and tout their superior manufacturing techniques.
- DO NOT drink the entire contents of a 5-Hour Energy drink at once. Unless, of course, you enjoy heart palpitations.
- The Media-Enhanced Home at Show Village showcased technology that home builders can easily integrate into their offerings. Wayne-Dalton Home Control Z-Wave unit, Schlage LiNK locks and Sony’s HomeShare multi-room entertainment and intercom system were among the home’s highlights.
- Need help selling upgrades? Rubbermaid demo’d — against the backdrop of the actual closet space you’d want to build out — its DesignPro software that allows builders to represent various closet configurations to clients. Home buyers get a visual representation of what the final product will look like and an accurate cost estimate. Builders can compare good, better and best selections with clients in minutes.
- Here’s convenience: Manufacturers are starting to make it easier for builders to be green. They’re calculating the number of points that can be gained in various green certification programs, including LEED, NAHB Green Home, EPA and Energy Star, for builders who use their products.
- Professional Remodeler’s Mike Morris had this experience: “I made an appointment at the Andersen booth thinking I’d see a new line of top-quality windows and doors about to hit the market, and of course I did. What blew me away, though, was Andersen’s Intelligent Estimate, a new, free online tool that delivers fast, detailed and accurate whole-project construction estimates for contractors. That’s right, I said free! It’s pre-loaded with cost information by zip code, is updated regularly and allows contractors to override cost data with their own pricing. You can create estimates, proposals, requests for bid, purchase orders, work orders, labor reports and material lists. Check it out at www.andersenwindows.com.”
- Pure-O-Flow’s whole-house reverse osmosis water filtration system caught our attention because it’s energy-saving, water-saving and money-saving. This system will remove many harmful elements that carbon and other systems won’t, including arsenic, barium, lead, radium. Learn more at pureoflow.com.
- Festool USA is a company some of us had little knowledge of, and the handyman/carpenter/woodworking geek that lurks deep inside our soul was rewarded at its booth. Check out their innovative line of cordless drills, miter saws, jigsaws, planers routers, sanders, multifunction work tables and more at www.festoolusa.com
- The concept of cogeneration — using natural gas or some other energy source to both heat and cool a home — isn’t new, but the U.S. residential market has been slow to accept it. It’s hard to imagine why, given the benefits. For example, ECR claims that Freewatt, its new HVAC system, will reduce the carbon footprint of a home by two-thirds and is 90 percent efficient.
- We liked garage door manufacturer Clopay’s new styles that dress up elevations, including “Ultra-Grain,” insulated steel that looks like wood.
- DaVinci Roofscapes introduced a synthetic slate line, Bellaforte, with interlocking, overlapping tiles.
Best Practices for Builders
- Don’t use rounded numbers such as $500, 3,500, etc., in bids and contracts, said Jo Pusteri of Elite Homes in his session, “The Art of the Deal.” Doing so shows numbers were massaged. Instead, deal in hard numbers: $3,529.23, $512, etc.
- To win a floor plan copyright infringement lawsuit, you have to prove the person actually copied your work and had access to your plan, according to the panel of lawyers at “Copyright Law for Builders, Architects & Designers.”
- A packed session on “Financing Knowledge: The Secret Weapon in Home Sales” reminded builders that using left- and right-brained negotiation to close a sale means sales staffs could be adding pocket protectors and calculators to their sales tool kit.
- During a lunch conversation with one of our editors, builder Fernando Páges-Ruiz talked about Vermont Energy Investment Corporation’s program to train a workforce of building performance auditors who can also do the work required to get buildings up to its eco-habilitation standards. Participating home builders can generate extra income in this slow market.
- Looking for a private equity “white knight” for cash? If you do find them, they won’t be riding to the rescue for free. This tidbit was heard at two different IBS educational sessions: private equity sources will be looking for anywhere from 20 percent to 30 percent in unleveraged returns. Gulp.
- These various ideas for surviving in today’s market were picked up during the “Securing Investors and Lenders in a Recovering Housing Market” and “Equity Partnerships 101” educational seminars:
- Help banks liquidate REO. Investigate opportunities to partner with banks as a general contractor on foreclosed properties.
- Don’t stretch yourself thin with land. Buy only finished lots and secure them under rolling optional contracts.
- Start networking at the country club. Think about forming joint ventures with wealthy individuals in the community including doctors, dentists, attorneys and accountants. Be sure you have a lawyer to help you cross the Ts and dot the Is for these types of agreements.
- Panelists for the seminar “Land Acquisition Strategies: Planning for the Next Cycle” noted that what institutional investors really want is stressed assets — anything they can get a deal on right now. They’ll buy notes as well as land, but land is preferable.
- Management consultant Chuck Shinn says builders should price new homes below market, to compete with resales.
- To get prices down, Chuck Shinn warns profit is not a residual, but rather the objective; direct costs are the residual.
- Sales trainer Michael Lee says builders should negotiate price with every prospect and not be offended by low-ball first offers.
Best Practices for Remodelers
- If the attendees at the seminar on the new EPA lead paint rules were any indication, remodelers have a lot to learn about the regulations before they go into effect next year. Get up to speed by reading this article.
- Sarah Susanka’s latest book, “Not So Big Remodeling,” comes out this month. Susanka said she believes the current economic climate and increased focus on sustainable remodeling makes the smaller-home concepts she writes about even more attractive to homeowners today.
- The recovery should come sooner in remodeling than new construction because remodelers don’t have to deal with the excess inventory builders do, said Kermit Baker, director of the Remodeling Futures program at the Joint Center for Housing Studies at Harvard University during the Remodeling Forecast program. That said, it will probably be 2010 before we see any improvement, JCHS predicts. Read more on the latest Harvard report here.
Trends & Innovations
- Iconoculture, which researches consumer trends, notes that living off the grid to be green — and as a backup to “the man” — is picking up speed. And consumers are being stylish about it, too. Instead of a normal rain bin, for example, they want water collectors that look like pottery.
- Our homing instinct is kicking in, according to consumer research by Iconoculture, which notes, “We go out less and gather at home for entertainment.”
- Design-it-yourself is taking off. Consumer research group Iconoculture notices that many consumers are ditching designers and getting in touch with their inner artist.
- A speaker at the “Land Acquisition Strategies: Planning for the Next Cycle” seminar said growth in baby boomer and active-adult communities has not been as large as expected. More of them are looking to age in place.
- At a session called “One Size Does Not Fit All: Managing Generations in the Workplace,” (a.k.a. Geeks, Geezers and Googlization, according to speaker Ira Wolff!), builders indicated they weren’t that cyber social; few raised their hands when asked if they were familiar with social networking tools like Facebook, Twitter or LinkedIn.
- Do geeks outnumber geezers? In “One Size Does Not Fit All: Managing Generations in the Workplace,” Ira Wolff said that Gen Xers and Gen Yers together outnumber baby boomers in the workplace.
- According to the Portland Cement Association, the prospects for economic recovery are even gloomier than what we’ve heard. Much more pessimistic than the Obama economists, PCA predicts that the construction industry won’t get any relief until 2012.
- Over coffee with one of our editors, Barry Gross, president of Developers Research, a national real-estate consulting firm based in Irvine, Calif., noted he sees a significant inflationary spike coming — maybe not in the next six months, but soon. Does that mean wage increases for everyone?
- A conversation with Bill Wood, vice president of operations for American Dream Development in Junction City, Kan., revealed there are opportunities for small and medium-size builders in military housing, specifically in smaller rural markets that are underserved because of base expansions. Wood says that families relocating to those bases are fatigued by institutional-looking houses. Instead, give them attractive, well-designed homes that would fit into any neighborhood.
- Baby boomers sure don’t feel old now, and won’t for a long time. During the seminar “New Rules for Marketing to the Boomer Consumer,” Matt Thornhill of The Boomer Project said that age-based marketing will not work for this demographic because boomers are all different. Instead, builders need to target them by income, socioeconomic status or other factors.
The 2010 International Buiders' Show will be held once again in Las Vegas, January 19 - 22, 2010.