How to Become a Professional Home Builder – Market Research

Market Research and Marketing

If you do any type of market research in this industry, you’re going to be ahead of the competition. The bulk of the builders I know just manage day by day and never really do any kind of market research. The thing I don’t want you to do is go overboard in market research so that you never build a home. You need to develop an accurate and concise research plan so that you can reach a clear-cut decision.

One key to good market research is a good real estate agent [Success Team Member]. A good real estate agent is always on the front lines. He or she knows what the customers want and considers what they value. A good agent is one with whom you want to list and sell your property. Even if you’re a licensed agent or broker, let a professional handle this for you. They’re working for you on those nights and weekends when you want to rest. They’re your go-between with the customer. I don’t want to deal with the customer. I want the agent to handle those negotiations.

Getting a signed contract is when your work begins. I don’t get excited over signed contracts. I get excited over closings and when I pick up my check. A good agent will work with the buyers, help them with financing and many other related items that I don’t want to be bothered with. If you ever become one of those builders who assumes the agents don’t know anything, then you’re on the road to failure because the agents know everything. The beauty of it all is, the agent only gets paid when the home is sold. Always use an agent and never, never, never build what you want to build. Build what the agents tell you to build. When you start in this industry you can’t afford to be a pioneer, because pioneers get arrows in the wrong places.

Now, you don’t have to spend lots of time and money doing this. Here’s all I want you to do. Go into a given area where you plan to build a home and jot down three real estate broker signs that you see in that area – three separate real estate brokers. Go home and call all three brokers. When you call a broker, you’re going to get the agent on duty to answer the phone. Don’t get locked into the agent on duty because the agent on duty may have little or no experience. Tell the agent on duty that you’d like to speak to the broker. When you speak to the broker, tell the broker that you’re looking for an agent who is familiar with the area where you want to build and is a member of the Million Dollar Club.

Now, listen. I don’t want to take anything away from those hard working agents out there that are not in the Million Dollar Club, but when you start out you’ve got to go for the gusto. I’ve found those agents that are in the Million Dollar Club have sacrificed friends, relatives and social life to sell real estate. They’re committed professionals. That is the kind of person you want to deal with. Tell the broker that you’d like an agent that earned most of his or her commissions selling homes, not listing homes. There is a big correlation between selling and listing. The successful listing agent is one that cultivates a large network of people. They’re members of tennis clubs and golf clubs, and they know a lot of people. You want an agent that got most of their money selling homes.

The broker will know what you mean. The broker may give you the name and number of one or two agents they can recommend. Don’t deal with two agents within the same company. Just deal with one agent. Contact the agent with a list of pre-printed questions that you’re going to ask the agent. Don’t tell them your grandiose plans. Don’t show them any of your plans. What you want to do is tell the agent you’re considering building in a given area or subdivision and you’d like to ask them a few questions. If things work out, tell them you’d consider them when listing your home. If deep in your heart you know you can’t let them list the home because you’re locked in with another agent in the subdivision, or some other business reason, then be honest with the agent. Tell the agents you’d like to ask them some questions and you’d be glad to pay them for their time. If they answer your questions without wanting payment, send them some flowers or a small gift as a token of appreciation. Remember, you’re going to receive only what you give.

Ask them questions like:

· If you were going to build in this area what size home would you build?
· How many bedrooms would you have?
· How many bathrooms?
· Would the master bedroom be on the first floor or the second floor?
· Would you’ve a two-car garage or would you’ve a three-car garage?
· Would you have a basement?
· What do you think of the schools?
· What do you think of the area?
· What would you do that other builders aren’t doing?

Write all of these answers down. After you complete the call, thank the agent for his or her time, hang up and call the other two agents. When you’ve completed these three phone calls, combine your lists, evaluate them and determine a common thread where all three agents said about the same thing. I want you to incorporate all those things into designing your next home. Add to it all those little goodies that you think are great and wonderful, and that you think will make your home unique. Then develop a set of drawings.

After you get a set of architectural drawings that incorporate all these features call these three agents back and set up lunch or breakfast appointments. Go to a nice restaurant. What an inexpensive investment to obtain this information. After the meetings, show them your drawings. This will accomplish two things. (1) You’ll have a professional critiquing your drawings. They may see little things that you’ve omitted or little things that need to be changed. (2) It gives you an opportunity to meet the agent and see if your personalities mesh and in that way you may indeed hire him to list your home. I can’t stress how important this is.

I had a builder student who heard this same message. He went out and built a beautiful home in a beautiful subdivision and didn’t sell it. He had to give it away and lost his shirt. Why? Because, in this case, the house had only three bedrooms instead of four. Any agent in that area could have told him, “You have to have four bedrooms in this subdivision.”

I know of a builder who built a beautiful home in a subdivision and had to sell it at a loss because his master bedroom was on the second floor not the first floor. Most of the people in this subdivision were retirees and they didn’t want to have a master bedroom on the second floor. Any agent in that area could have provided this information.

I remember a builder who built a beautiful home in an area called The Atlanta Country Club at the same time I was building there. He sold it at a loss because his dining room was too small. Any agent in that subdivision could have told him, “Your dining room is too small.”

I built an $800,000 home when the interest rates were 18%. I showed an agent the drawings. In a large home like this, the owners liked to entertain. Consequently the flow of traffic through the home was important. I had what is called a dead-end living room, that is a living room with no access out. The agent quickly pointed that out. I changed this before we began construction. I’d have been sitting on an $800,000 home paying almost $300 a day in interest because I didn’t have another door in the living room! The agent is very, very important in understanding what the buyer wants.

Custom Home Builder Website SEO and Possibilities for Web Interaction Before Construction Starts

Custom home builders utilize personalized and customizable building plans to construct residential and business properties according to the needs and ideas of their clients who equally participate in the creation and design of these homes. Their projects include multiple sizes and architectural form solutions to create a building that can will incorporate personal requests or input of people who are intended users of these homes in the future, when they are built and ready to be inhabited. Some people tend to think that custom builders only deal with large projects involving luxury homes or expensive mansions, in reality, today’s custom construction companies offer a variety of small-scale projects and provide free form design and expert information suitable for all kinds of construction plans and budget considerations. These custom form building companies also create demand for smaller markets and small-scale client base which will form a foundation of high quality and low cost solution in virtually any climate or geographic area.

From this perspective, the importance of professional web advertisement using search engine optimization techniques for the website is obvious when custom home builders look for ways to expand and promote their business of custom design and site construction and position themselves on the local market ahead or even free of competition.

The advantages of using HTML-based and keyword link interface to generate considerable traffic to the contractor’s website are in that the company can describe what they do and how they do custom construction based on resources and people they have and familiarize interested individuals with the scope and magnitude of construction projects they can perform. When potential client enters keywords or phrases online that determine what kind of information the client is looking for on the website, the builder’s company’s site will provide a link to the exact answer to the needs of people building their new home or renovating existing premises.

Depending on local area and neighbourhoods, the website based advertisement using SEO for Google and other popular online engines and creating interface for potential buyers to look into options of customizing their planned construction activities, creates opportunities for commercial companies to find work in the area that is designed with consumer in mind. This online advertising model allows flexible work planning and very versatile relationship with potential client because the keyword search for the website connects contractor and buyer by means of predetermined conditions and incorporation of client’s voice from very early stages of site design and construction makes custom solutions truly customized with communication and website search process for thousands of plans and drawing for the contractor, client and local community.

This type of creative online marketing which encompasses all angles of technical knowledge is very different from the rigid and all-in-one non-web approach that other methods of advertisement and leads generation might have. By constantly tuning and adjusting content details of the project agreement, commercial building companies become able to turn their service into a completely new and exciting website hosting idea.

Buying Eggs – An Introduction To 21st Century Advertising For New Home Builders

Everyone has heard the old saying “love makes the world go round.” Most have heard the typical rebuttal “money makes the world go round.” But in reality, neither of these actually explains the movement of the universe.

The phenomenon that actually fuels the world in its revolutionary progress is purchasing. Money doesn’t have much of an effect on anything until it is used; until a purchase is made.

Some might say that the way in which money is used is determined by the individual in whose hand the bills reside; that the use of money depends upon personal and/or family needs and individual circumstances. To these people I would like to offer my congratulations on their idealistic vision of the world around them.

The world might be a better place if I could agree, but I would argue that the majority of today’s financial decisions are influenced so heavily by outside forces that they can’t really be said to be the direct result of personal needs or circumstances.

For instance, once upon a time if a man needed an egg, he wandered in the forest until he found an unguarded nest and he took the egg he needed (or all the eggs if he was greedy.)

A little time passed and a similar need would arise with a similar man and the man would fulfill the need by wandering out to his henhouse, lifting up a hen and taking the egg he needed.
More time passed and a similar man with a similar need might walk to the town market to purchase or barter for the egg he required.

Still more time passes; another similar man with the same need visits his local grocer on his way home from work to procure the needed egg.

Even more time flies away and we find ourselves in the world of today. But this man faces many questions before he will be able to obtain the object of his desire.

The first question is where will he purchase the egg? Is he going to go to a convenient store? It’s quicker; it’s more expensive; it may be very close.

Is he going to visit a grocery store? And if so, which one? Will he go to the closest store to his home? Will he visit the one nearest to his work on the way home for the day? Will he visit the grocery store that has the best sales? Will he visit the grocery store that is known to have the highest quality products? Will he visit the grocery store that is known for its specialty items? Will he go to a health food store? Will he go to the store he is most familiar with for that reason alone?

Once he arrives at the chosen location he will be faced with still more questions. How many eggs will he be purchasing? Will he go with a flat dozen? Does he need a dozen and a half? Will he look to see if they can be had by the half dozen? Or maybe he should buy in bulk.

Next he will need to know if small, medium, or large eggs suit his needs the best. Brand names and prices will vary and offer more options.

Some men would even go so far as to include the chickens from which the egg originated into their purchasing equation. Did the eggs come from cage-free chickens?

So what caused the drastic changes? What made it necessary to question such a simple, straightforward need and the mode of fulfilling it? The most obvious answer (and the correct one in my opinion or I wouldn’t be offering it to you) is the availability of choices.

When there is only one option that is the option that is used. And likewise, if an individual is aware of only one option, that is the option that is used. And similarly, if an individual is convinced that one option is better than another that is the option that is used.

You may wonder why we are discussing eggs. Eggs are a solid example of a need that has been in existence for so long that no one questions the fact that they will be bought and sold.

As long as people are around they will need (and want) to eat. Other such needs are obvious. After eating the most obvious need is shelter.

While natural shelters were all the rage “once upon a time” they are really only fully appreciated in our modern times during times of desperation, extreme survival, and dire emergencies. Other than that, most people look for a bit more in their mode of “shelter” nowadays than the nearest cave with convenient cover from the rain.

The same evolution of available options we discussed with the egg is evident when it comes to “shelter.” Today’s purchasers find themselves with a plethora of options when it comes to which home to purchase; especially once they’ve made the decision to build a new home.

It used to be that if someone decided to build a home they contacted their local contractor and that was it. He took it from there.

He had built other homes in the area and they were in use and apparently he was able to fulfill their need. Build it and they will come and all that. But we are all very aware of the myriad changes that have been wrought in this particular industry, and so are most of the buyers out there.

You might still run across the rare individual who is going to go to the nearest builder because they are in the area they are familiar with regardless of their standing with other local builders and national competitors. This is the same individual who will go to the grocery store they always visit because they feel comfortable walking in the doors, they know where to find the eggs and they know which cashier is the quickest.

But this individual is not as common as many think. Most purchasers know the value of their money and want to stretch it as far as it will go.

They research and they take unofficial surveys of friends and family to try to ascertain which product will best fulfill their needs. And all the time, smart builders are doing their best to put themselves in front of prospective buyers as the solution to their every individual requirement.

We call it sales and marketing. Advertising is all well and good. Sales are an accepted necessity, but the combination of both of these, along with appropriate research and statistical analysis to increase company profits, is the key to success in today’s new home building market.

Separating the marketing from the “sales and marketing” is a mistake that too many make. If you take the sales out of sales and marketing you’ll soon discover that all you have left is a lot of glitz and glam without any results. And results are the reason for “marketing” in the first place.

There are those in marketing who attempt to avoid the responsibility that is placed on them by the expectation of results by claiming that results can’t be measured in marketing. This is an embarrassing side step and an obvious attempt to refuse to accept that there is a purpose to marketing that makes it vital to any company; and that is sales.

Without the sales to go along with the marketing it becomes an extra expenditure that doesn’t pull its own weight. Companies that find themselves in this situation typically cut their budget and remove marketing from the situation altogether.

I can’t blame them, other than to berate them for failing to recognize that what they needed was to redefine their company’s interpretation of marketing and redirect their team towards a marketing program resulting in direct sales increases or hiring someone who can.

Marketing is measurable. And it should be measured. The easiest way, and most productive way to do so, is sales.

Good marketing should increase sales. And the only way an individual or company can be successful in a sales and marketing program is to always remember that their overall goal is to get more people to buy more stuff more often so that more money will be generated for the company and profits will increase.

Marketing is about selling stuff. It is not about creating an image. That’s another guy’s job that will help you in successfully selling and marketing your product, but won’t do your job for you.

A couple of decades ago the success of a new marketing campaign was measured by the elevated image of the company. Image was everything. But in the end you can produce a new ad that is award winning, popular, and wonderful, but if it doesn’t increase sales it is next to worthless.

Sales & Marketing is about selling the product; it doesn’t matter if those already buying your homes appreciate the clever ad or if the big wigs in the company think the ad positions the company well.

The end result, sales, is always the only result that matters. It doesn’t matter if everyone loves your marketing campaign and loves your product because of it…if they just don’t feel compelled to buy it. Successful marketing campaigns compel consumers to purchase; not appreciate and adore, but to purchase.

If there is a choice between a marketing campaign that results in nationwide popularity without increased sales, or a marketing campaign that results in nationwide censure with sales increases…which do you think would be viewed as a successful campaign by savvy owners?

Marketing in the new home industry began due to the introduction of choices (or competition). Competition does two things: increases product quality through necessity and introduces the need to make the public aware of the increased product quality.

Builders who had never before had to compete for their work were eventually introduced to the world of sales and marketing through necessity. As discussed earlier, when there is only one option or one builder, new home purchasers are going to use the one builder available.

When a second option is introduced through a second builder, willing and able to build new homes in the area, there ensues a new aspect of business never before necessary.

Competition results in both the refinement of the product and services offered to consumers (you now have someone who you want to appear better than in the eyes of the public) and sales and marketing; you want the public to be very aware of exactly why you are better than the competition and why the sale should be one they make with you and your company.

The history of traditional “old school” advertising and marketing for new homes included newspapers, signs, billboards, location, and we can’t forget the be all and end all “build it and they will come” theory. New home builders still depend upon models and spec homes, but not to entice new home buyers to look at their homes.

Successful new home builders of today don’t depend upon consumers seeing their models and coming to see what the fuss is about. They reach out to potential new home buyers with focused advertising coupled with clearly defined sales and marketing plans using all available mediums.

The traditional advertising mediums are included in the process, but new, even more advantageous and far reaching mediums have been added with the easy access to consumers offered by the television and the Internet.

Builders in the past could rely on a quality product and a good reputation to survive and even thrive in the new home industry, but in today’s market the builder who gets ahead is the one who is dedicated to fully understanding and incorporating modern sales and marketing techniques into their day-to-day advertising and business maneuverings. The successful builder will address the 5 M’s of Advertising and Marketing: Market, Money, Media, Message, and Messenger.

Choosing The Right Home Builder – Interview Questions

Building a home will be the most expensive and complex project you are likely ever to be involved in. The only way to make sure that you have chosen wisely is to be prepared and conduct enough research to be knowledgeable on the housing market in your area and the builders that you will be contacting. In order to choose the right home builder make sure to take in the following advice as not all home builders are the same.

Basic market research

Now that you have decided to build a home, contracting a home builder should include a proper vetting procedure. Part of this procedure should include understanding the local housing and building markets. One of the best places start is to contact your home builders association in your area or a national building association. These associations can provide qualified, certified professional home builders to start your search. Follow this up by looking at current real estate advertising to assess active builders and pricing guidelines for similar houses that you intend build. Lastly reach out to friends, family and known real estate agents for referrals. By the end of this process you should have a basic understanding of the current housing market and the top builders in your area. Starting with 10 to 15 builders will give you enough prospects to narrow down your choices.

The interview

In order to assess builders in your area to meet your specific needs they should be willing to sit down with you and answer your questions. This provides you with a basic assessment if the builders can your needs.
Ask the following questions:

– How many years have you been in business? How many homes have you built?

– Are you licensed and insured?

– How do you compare to other builds and what are the best features of your homes?

– What type of warranty do you offer?

– Do you have model homes or references that I can contact?

– Do your homes meet the six star energy rating qualifications?

– Can you custom build homes or change current designs to meet my specifications?

– What are the standard features of your homes and what are available upgrades?

– Who will oversee the construction of my home and who is the direct contact for me?

– What is the process for making changes before or during construction?

– How and when will the final price for the home be determined?

– How often will I have access to the home during construction?

– How long will the build process take?

– Are you a specialty home builder or a mass producer?

An experienced builder will be able to answer all of the questions easily and quickly. If the builder vacillates on any of these questions they may not be the right choice. One of the most important aspects of home building is receiving value for quality not building the absolute cheapest structure possible.

By following these tips and asking the right questions the largest project will get off on the right foot with the right builder. By having an in-depth interview it will give you the peace of mind to move forward and even if issues or concerns arise they will be expertly handled.