Jim Sorgatz

It’s Never Too Late to Pivot: Embracing New Technologies in Home Building

October 1, 2024
By Jim Sorgatz

In a rapidly evolving world, the ability to adapt and embrace change is more crucial than ever. While some industries may seem to move at lightning speed, others, like home building, can sometimes be slower to adopt new technologies. However, history and recent innovations teach us that it’s never too late to pivot and find success. Drawing inspiration from people who find success late in life, and groundbreaking companies like Tesla, this post aims to encourage home builders to embrace new technologies, including AI, to stay competitive and thrive.

Late Bloomers: Success Can Come at Any Time

Facing a milestone birthday this month, and always looking for ways to improve and innovate, I found this article in The Atlantic titled “You Might Be a Late Bloomer” fascinating. In it we learn about remarkable individuals who found success later in life. This includes figures like Paul Cézanne, who, despite facing rejection early in his career, became one of the most influential painters of the 19th century. Another late blooming icon is Colonel Sanders, who founded KFC in his 60s after a series of career failures.

These stories remind us that success isn’t confined to the early years and that it’s possible to achieve greatness at any stage of life. This is a powerful message for many home builders who may feel hesitant to embrace new technologies, thinking it might be too late to change established methods. The reality is that there is always room for growth and innovation.

*AI generated oil painting in the impressionist style of Paul Cezanne.*

Tesla: Interrupting the Interrupters

Tesla serves as a prime example of a company that disrupted the auto industry with electric vehicles and is now being disrupted itself. Tesla’s innovative approach redefined what was possible in a sector long dominated by traditional combustion engines. Their road to electrification of vehicles and potential autonomous driving has been rocky to say the least. But they have made tremendous progress over the past few years, operating like a fine-tuned engine. Then BAM! Along comes Chat GPT and other large language models. Tesla is now pivoting towards artificial intelligence, demonstrating their commitment to staying ahead of the curve. If successful, AI will bring autonomous vehicles to the road much sooner than expected, plus lead Tesla to success in their quest to build robots capable of performing the most complex tasks. It’s incredible to realize that since they began producing cars at scale, Tesla’s meteoric rise to the top of the auto industry and subsequent pivot to AI has taken place in a span of ten short years.

*Tesla Optimus Bot – Interrupting the Interrupter*

This ability to continually evolve and integrate new technologies is what keeps companies like Tesla at the forefront of their industries. Home builders can draw inspiration from Tesla’s journey, recognizing that adopting new technologies, even later, can lead to significant advancements and success.

Embracing New Technologies in Home Building

For home builders, integrating new technologies can seem daunting, especially if they have been following traditional methods for years. However, the benefits of embracing innovations like AI and other digital tools far outweigh the challenges. Here are a couple of home building-specific examples of new technologies that can revolutionize the industry:

Interactive Floor Plans and Virtual Tours: These tools allow potential buyers to explore homes in detail without physically being there. Interactive floor plans enable users to visualize different layouts and customize their future homes. Virtual tours provide an immersive experience, showcasing the property’s features and finishes. These technologies can significantly enhance the buyer’s experience, making the decision-making process smoother and faster.
AI-Powered Project Management: AI can streamline various aspects of the construction process. For instance, AI-powered project management tools can predict potential delays, optimize scheduling, and manage resources more efficiently. This not only improves productivity but also reduces costs and enhances the overall quality of the project.
AI Enhancements for Homebuilder Websites: Industry partners like chatbot provider AtlasRTX, and home sales optimization expert Openhouse.ai provide AI tools for builder websites to increase user engagement and generate more sales. The Openhouse.ai platform also works with Outhouse interactive floor plans to guide homebuyers to the perfect home.

*Layered interactive condo/townhouse map. Click to explore the buildings.*

Case Studies: Builders Embracing Change

Consider the example of a small, hypothetical home building company, XYZ Builders, which decided to integrate AI-powered project management tools into their operations. Initially hesitant, they soon discovered that these tools significantly improved their workflow. They were able to complete projects faster and with fewer errors, resulting in increased customer satisfaction and a 20% boost in sales.

Another example is ABC Construction, which adopted virtual tours and interactive floor plans. Despite initial resistance from their VP of finance, the company quickly saw the benefits. Their online engagement skyrocketed, and they attracted a broader audience, including out-of-state buyers who could now explore properties remotely.

For home builders, adopting new technologies can open up new opportunities and lead to greater success.

At the 2024 International Builders Show, home building consultant Al Trellis, President of Home Builders Network, gave a presentation to a sold out crowd on the power of artificial intelligence for home builders. Real life examples of AI making a positive impact for his clients include:

Rapid development of a comprehensive training program for superintendents, including scopes of work for various jobs and trades.
Development of an HR program.
Marketing campaign for inventory homes.
Creation of a private placement memorandum.
Generation of ideas to stimulate sales of a stalled condominium project.

The uses for AI in home building are limitless. In addition to marketing and operations, we are seeing the start of AI innovations in CAD and the construction process as well.

Conclusion: It’s Never Too Late to Pivot

The stories of late bloomers like Paul Cézanne and Colonel Sanders, along with the innovative journey of Tesla, illustrate that it’s never too late to pivot and embrace change. For home builders, adopting new technologies can open up new opportunities and lead to greater success. Whether it’s integrating AI for project management or using interactive tools to enhance the buyer’s experience, the key is to stay open to innovation and continually seek ways to improve.

So, take the leap. Embrace the new technologies that can transform your business and stay competitive in an ever-evolving market. Remember, it’s never too late to pivot and achieve greatness.

Know Your Homebuyer Audience

October 1, 2024
By Jim Sorgatz

Are you surprised by the new home construction trends in your own city?

Guess which house is the newbie?!

Having been in the industry for nearly 30 years, it is not often that I am surprised by trends in new home construction. The goal is to sell to anyone who financially qualifies. And, in these times of elevated interest rates and home prices the buzz is all about affordability, which typically translates to smaller homes. So, I am shocked to see the newest homes being built in my “affordable” neighborhood are 50%+ larger and significantly more expensive than my home that was built in the fall of 2022. The families shopping for homes right now are, apparently, looking for space, and have the means to afford a bigger house. And I guess that makes sense. Although there genuine efforts by cities and builders to create affordable housing, with a median price of $430,000 nationally per realtor.com, there really aren’t many homes that are affordable right now for first-time homebuyers. This hammers home the importance of knowing your core audience, building for them, and marketing to them appropriately.

There are many builders who do this well and adapt to the changing environment. One example is Arizona based Meritage Homes whose mission today is, “To design and build homes that are innovative, built with care and superior craftsmanship, which deliver enduring value.” Contrast that with their mission a couple years back, “To build move-in-ready affordable homes for entry-level and first move-up buyers,” and you can see the evolution to better reflect the current new home market.

How can you be sure you are targeting the right audience? Begin with a review of your overall marketing strategy. Do your website, sales offices, and print marketing appeal to the potential buyers you are attempting to attract? Although first-time and luxury home buyers are both seeking out their dream homes, the marketing for these two distinct groups looks very different. This is where consultation with marketing experts like Denim Marketing, Blue Tangerine, Adlanta Creative, and Bokka Group to name a few, can be highly beneficial.

Next, review your digital marketing tools, and upgrade them if necessary. If you are still using static floorplans and stick renderings, think again. Interactive floor plans, renderings, virtual tours, animations, and visualizers all play an integral role in engaging homebuyers and selling homes.

Interactive Floor Plans (IFPs) have universal appeal, and every builder website should feature them. Buyers of all demographics love to select structural options and customize their living spaces with the interactive furniture planner.

Outhouse’s new colorized Interactive Floor Plan

Quality renderings are essential for all builders as well. Black and white stick drawings are never a good option, even for the simplest of homes. Standard 3D (Outhouse Bronze and Silver) renderings are perfectly acceptable for homes at lower price points. For move-up and luxury homes, you will want to implement 3D photoreal renderings (Outhouse Gold). Luxury and custom builders may want to opt for Platinum renderings that can be further enhanced and customized.

Should your budget for digital marketing tools be a bit larger, investing in animations and virtual tours pays off in two significant ways. First, they enable homebuyers to digitally explore your homes from anywhere. Second, both are available at a fraction of the cost of constructing a model home. Your target buyer should be the top consideration when choosing which format to offer. Younger buyers prefer user-controlled virtual tours. Buyers over 50 typically gravitate towards video format animations.

Visualizer’s allow home buyers to customize interiors and exteriors

Another online tool appealing to home buyers at all price points is the Visualizer. With both interior and exterior versions available, buyers can mix and match colors and finishes to achieve the desired look and feel. The visualization process is so much easier than making selections for an entire house based on one-inch paint chips and tiny floor, counter, and cabinet samples. It also removes some of the pressure and stress from the design center visit.

Here are a couple more ideas to help you connect with your appropriate audience:

Elevate your brand with distinguished print marketing. Consider the hotel industry when investing in print—the swankier the property, the more excellent the print collateral. The manager of the high-end hotel presents you with a “folio” at checkout, not simply hands or emails you a bill. Although print appeals greatly to buyers in the luxury home market, even younger homebuyers like to walk away from the sales center with a brochure featuring their preferred floor plan and elevations at a minimum. In today’s digital world, people still appreciate a tangible marketing piece when making one of their biggest life purchases. Why not present them with something sophisticated or fun, and memorable?

A great print piece makes a lasting impression!

Today, the most progressive builders are transforming their websites with artificial intelligence (AI) to better understand and target their audience. Like that provided by openhouse.ai, AI offers home buyers a personalized shopping experience and predicts where your unique market is going with more accuracy.

So take some time during this evolving housing market to understand your homebuyer and determine if your current marketing strategy is meeting their needs. If not, consider working with online marketing experts to determine which digital and on-site tools will move the needle most with your target audience to increase your new home sales.

Growing New Home Sales By Casting the Widest Net Possible

October 1, 2024
By Jim Sorgatz

Shortly after moving to Blaine Washington, a small city sitting right on the United States and Canadian border, my spouse suggested we head to the Night Market located in Richmond, a suburb of Vancouver. I happily went along knowing nothing about this event other than it ran from 7:00 PM to Midnight, and and there would be food vendors. I was hoping the food might be better than the the typical state fair, and I wondered if the market would look a bit like a renaissance fair with turkey legs and all. When we arrived I saw this!

Night market packed with people between two rows of food booths. — The Richmond Night Market

There are more than 600 food booths here, and 90%+ of them are Asian. A quick search on Google and I learned Richmond is home to 230,000 people, three quarters of whom are Asian Canadian. The food was amazing, and I’m ready to fight the crowds again this summer. Having never been to Asia, I finally had a taste of the infamous night markets that friends tell me offer some of the tastiest delights.

In the stretch of the Pacific Northwest between Vancouver and Seattle, there are significant populations of immigrants from around the globe. China, Japan, Korea, India, Mexico, Europe, Ukraine, Russia, and many more. In my neighborhood in Blaine which sits right on the border, we have residents from both Canada and the U.S. as many families lives take place in both. This is often due to marriage, jobs, or immigration status. Peace Arch state park which is an open space between the two countries was one of the only places along the border where families could meet during the pandemic. I love taking the pups there, and jokingly warn them not to say “Eh” when we are on the Canadian side.

What does all this have to do with home building? North America is a melting pot of immigrants and cultures. Unless you are Native American, most of our families traveled from other countries to get here. And as more immigrants arrive, put down roots, and start their own families, home builders may need to look a little differently at the design, sales, and marketing of new homes. Just as men and women, families, singles, and various generations seek out different amenities in new homes and neighborhoods, people from various cultures often have unique wants and needs as well. North America also has home builders founded by immigrants including Outhouse clients Couto Homes in Texas where the Couto family hails from Portugal, Trico Homes in Alberta founded by Wayne Chu who came to Canada from Hong Kong, and K. Hovnanian Homes whose founder is from Iraq. There are also builders owned by foreign entities like Woodside Homes (Sekisui House), and Stanley Martin Homes (Daiwa House USA).

What it all boils down to is, like the diversity within our industry, the pool of homebuyers is vast. Casting the widest net possible to reach buyers is essential for sales. And that means thinking outside the proverbial box, and diversifying our sales and marketing strategies.

To continue this conversation, On Tuesday, May 21, 2024 at 11:00 AM PST, Outhouse invites you to join us for a webinar featuring Magda Esola from Brookline Homes, Ingrid Prince from Shared Drive, and Safiyyah Siddiqui from DHS Realty. Coming from varied backgrounds they will share their thoughts and experiences on selling homes with diverse buying groups. If you miss the webinar, you will find the program posted on our YouTube Channel following. REGISTER TODAY!

Tackling the Home Building Labor Shortage

October 1, 2024
By Jim Sorgatz

Two Innovative Organizations Making Strides In Workforce Development

One of the greatest challenges facing the home building industry in recent years is a labor shortage. With more and more kids going to college, and the tightening of work visa programs for immigrants, recruiting skilled workers has been a full-time job for many home builders and trade contractors. But the tides may be turning. A recent article in the Wall Street Journal, “How Gen Z Is Becoming the Toolbelt Generation,” observes that more young workers are going into trades. A few reasons for this are disenchantment with college, rising pay, and new technologies making careers in building much more exciting.

Home builders are also making strides in workforce development. I’d like to focus on a couple of innovative programs that are demonstrating success in this arena.

Jim Sorgatz, Outhouse VP Marketing holding The House That She Built book, flanked by Natalie Miles, owner of Natalie Miles Design, and Kristi Allen, owner of Woodcastle Homes — Natalie Miles, Owner – Natalie Miles Design, and Kristi Allen, Owner – Woodcastle Homes, with Jim Sorgatz, Outhouse VP of Marketing at a PCBC Professional Women in Building Bruncheon celebrating the success of The House That She Built

She Built Foundation

First is the She Built Foundation, an organization whose mission is to inspire girls to become the next generation of builders. It all started with a little book called The House That She Built, written and illustrated by Mollie Elkman and Georgia Castellano of Group Two. Published in 2021, this book has captivated thousands, inspiring a mostly women-powered movement, bringing the book and accompanying activity book to schools, libraries, and Girl Scout troops across the U.S. To make an even greater impact, the She Built Foundation was introduced to attendees at the 2024 International Builders Show. Did you know that 41% of the U.S. construction workforce is retiring by 2031? The need for construction professionals is great. Women currently only make up 11% of our industry. This organization serves a critical role in educating young girls (and boys) on the benefits of a career in building.

Home Building Academy

A little lesser known is the Home Building Academy located in Phoenix, Arizona. This initiative was launched in 2023, by Home Builders Care, the charitable arm of the Home Builders Association of Central Arizona (HBACA). For students in this 9-week construction training program, tuition is fully paid, and they leave with certifications in carpentry and electrical. In the first four weeks of the program, students learn the basics of construction including:

Reading a tape measure
Understanding construction documents
How to build, level, plumb, and square
Using hand and power tools
OSHA 10 safe working practices

Following the classroom introduction, students move to hands-on training in carpentry or electrical. Check out the informative video on the Academy website to learn more.

Students at the Home Building Academy practicing construction and electrical skills, against a backdrop of wood framing. — Students at the Home Building Academy practicing construction and electrical skills

Support for programs like this is crucial. Ed Brady, CEO of the Home Builders Institute, tells us we need to replace 2.1 million jobs in the next few years. We have a 2-3 generation shortage of workers, and many longtime building professionals are aging out.

One way you can support the Home Building Academy is by drinking wine and craft beers, and eating some delicious food! Coming up on Saturday, May 11, 2024, is the return of Builders Uncorked, an event I helped launch during my tenure at the HBACA. This fun evening features stations with a unique selection of wines from around the globe. All funds raised go to train the next generation of home builders.

Congratulations to HBACA CEO Jackson Moll on the success of the Home Building Academy. And cheers to Lisa Rugloski, Stratton Hickcox, and the rest of the HBACA team who are leading the charge to raise funds through the Builders Uncorked event. With Phoenix Metro being one of the fastest continually growing areas in the country, the Home Builder Academy’s role in training workers for the future is vital to the home building industry.

Optimizing the Design-Market-Sell Continuum: Tips for Home Builders – Part 2

March 28, 2025
By Jim Sorgatz

In the dynamic world of homebuilding, a term that often echoes through the corridors of innovation is “value engineering.” Investopedia defines it as a strategic method aimed at delivering essential project functions at the minimum possible cost. This approach champions swapping out materials and methods for more cost-effective alternatives while maintaining the integrity of functionality—and, we’d argue, quality, too.

At Outhouse, this principle is at the heart of our Design-Market-Sell methodology. Our suite of services—from drafting to visual aids and digital innovations to print solutions—caters to builders across the spectrum. Yet production home builders crafting anywhere from 30 to 3,000 homes annually, stand to gain the most from our holistic approach. By integrating our seasoned Computer-Aided Design (CAD) expertise, builders can forego the hefty expense of maintaining an in-house drafting team. As our CAD wizards work their magic, our graphics and rendering teams get cracking on interactive floor plans, site maps, virtual tours, and much more, paving the way for a seamless transition to print media and sales office displays. This cohesive strategy not only accelerates your market entry but does so with significant cost efficiency. And therein lies the secret to mastering the Design-Market-Sell continuum.

In the first chapter of this series, we unpacked the foundational tools every builder needs to design, market, and sell new homes. Now, let’s dive into the digital realm that captivates homebuyers and enriches their purchasing journey.

Crafting Emotional Connections: The Power of Interactive Floor Plans and Site Maps

Outhouse has been at the forefront of Interactive Floor Plans (IFPs) and Interactive Site Maps (ISMs) for over two decades, boasting a portfolio that’s as robust as it is innovative. Optimized for mobile use, these tools work like a dream on any device, aligning perfectly with the preferences of over 70% of today’s homebuyers.

Erin Kearney, VP of National Accounts

Erin Kearney, our VP of National Accounts, emphasizes the importance of understanding buyer needs and adopting a personalized sales narrative. The ability to swiftly capture and analyze consumer preferences sets a builder apart in a market brimming with competition. IFPs and ISMs are more than mere marketing gimmicks; they are bridges to potential buyers’ hearts and minds, allowing them to visualize and tailor their future homes. This emotional engagement is akin to the bond formed during a car’s test drive, transforming a potential purchase of “your house” into “my home.”

Moreover, ISMs offer a comprehensive view of available lots, linking directly to elevations, IFPs, virtual tours, and more, thus streamlining the journey from lot selection to home customization.

Marrying market insights with interactive tools is critical to truly excel in sales. These technologies elevate customer interaction and deepen the emotional bond with their future homes, positioning builders as pioneers in their field.

Sketch of Marilyn Monroe against a wood plank backdrop with the words, "Helpful Tips - Interactive"

Maximizing Engagement with IFPs and ISMs

Success with IFPs and ISMs hinges on precise construction documents and strategic website placement. Marcy Smith, our incredibly talented but media-averse Graphic Department Production Manager, shares invaluable tips for optimizing these tools:

Ensure clarity and accuracy in your CAD files before engaging with a digital tools provider. Autodesk offers a free ‘DWG TrueView’ for this purpose.
Incorporate a PDF version of your CAD files for ease of reference.
For IFP projects, detailed CAD files minimize back-and-forth, saving time and resources.
Clearly delineate desired lots for ISMs, especially in master-planned communities, to avoid unnecessary costs.
The placement of these tools on the website is crucial; they should be prominently displayed for easy access by potential buyers, enhancing engagement and site retention.

Outhouse partner Stuart Platt

Virtual Reality: The Frontier of Digital Engagement

Virtual Reality (VR) stands as the latest marvel in digital homebuilding tools, offering virtual tours, animations, and visualizers that transport the model home experience to buyers worldwide. Stuart Platt, an Outhouse partner, advises:

For interior VR projects, consider selecting from Outhouse’s extensive library of interior designs to save on costs, unless custom designs are necessary.
Utilize color and material visualizers to give buyers a comprehensive view of their customization options, though it’s wise to limit exterior color schemes to maintain community aesthetics.

As a quick VR refresher: Virtual Tours are user-controlled tours – buyers click from room to room. Animations are essentially a video tour. And, Visualizers are customization tools that allow buyers to select options, colors, and finishes whether it be interior cabinets and countertops, or exterior roofing, stone, and siding.

In Summary

The key to optimizing the design-market-sell continuum is to work with a sole provider like Outhouse – the outsource hub for home builders. Whether launching a new community or seeking innovative cost-saving strategies, Outhouse is here to guide you through optimizing your design, market, and sell process. Reach out today to explore how we can transform your homebuilding journey.