As we approach the end of another eventful year in the home building industry, it’s the perfect time to reflect on the key lessons and takeaways that can guide us into a promising future. Despite the challenges and uncertainties, there’s much to learn from the experiences of the past 12 months. Here are some crucial year-end takeaways for the home building industry:
- Adaptability Is Key: The year 2023 highlighted the importance of adaptability. Home builders who quickly adjusted their strategies in response to changing market conditions were better positioned for success. Flexibility and the ability to pivot in the face of challenges have become valuable assets.
- Digital Dominance Continues: The digital transformation in the home building industry is no longer a trend; it’s a necessity. With homebuyers relying on online research and interactive tools like never before, having a robust online presence, including virtual tours and interactive floor plans, is essential. There is some good news here: the costs of these digital technologies are dropping. This is an excellent opportunity for smaller homebuilders seeking a competitive advantage. Builders who want to stay ahead of the curve in 2024 should consider implementing digital assets they may have believed to be out of reach. Pricing has become much more competitive in recent years. Putting some digital tools in place could mean the difference between staying in the game and being unable to remain competitive.
- Supply Chain Management: The global supply chain disruptions served as a reminder of the significance of efficient supply chain management. Home builders should build resilient supply chains to prevent delays and maintain construction timelines. Resilience is essential in every part of the supply chain, from labor to subcontractors to materials and technology. 1
- Sustainability Matters: The demand for sustainable and energy-efficient homes is rising. Incorporating green building practices appeals to eco-conscious buyers and helps reduce long-term operating costs. The home building industry is waking up to the importance of green building. Even NAHB and IBS are getting involved by funding a Green Building Scholarship. Please find out more by visiting their website: https://www.nahb.org/advocacy/industry-issues/sustainability-and-green-building/sgb-scholarship-for-ibs
- Quality Over Quantity: Prioritizing quality over quantity is becoming the mantra of successful homebuilders. Delivering superior craftsmanship and focusing on customer satisfaction can lead to lasting success in the industry. For an interesting read about improving housing in America, check out what the Joint Center for Housing Studies of Harvard University found about the impact of COVID-19 on our current market. They have some interesting statistics on home repair ($420 billion spent in 2020), DIY vs professional, and the demand for quality housing. https://www.jchs.harvard.edu/improving-americas-housing-2021
- Teamwork and Talent: The importance of a skilled and motivated workforce cannot be overstated. Investing in employee training and well-being can improve productivity, retention, and overall company success. Continuing education for your Online Sales Counselors and Marketing team is imperative. The digital landscape is ever changing. Marketers need help to stay current. Summits and conferences can pay 100-fold. Online Sales Counselors are only as good as their sales experience and education. Help them by ensuring they have all the tools in their toolbox.
- Customer-Centric Approach: Home builders who put the customer at the center of their operations tend to thrive. Excellent customer service and transparent communication go a long way in building trust and loyalty. More and more builders are discussing that a customer-centric approach might involve having transparent online pricing. Just listen to what Reilly LePage of Logel Homes had to say on The Home Builder Digital Marketing Podcast: https://www.buildermarketingpodcast.com/episodes/190-elevating-the-online-home-buying-process-reilly-lepage Builder Online thought this was such an important topic that they featured the podcast this month on their Builder 100.
- Risk Management: With uncertainties in the market, effective risk management strategies are crucial. Planning for potential disruptions and having backup plans can mitigate unexpected challenges. Conducting market analysis before starting a project, having a robust financial reserve, and securing contracts with backup suppliers are just a few ways to mitigate risk.
- Local Market Insight: Understanding the unique dynamics of local markets is essential. Tailoring strategies to meet each community’s specific needs and preferences can make a significant difference. Home builders can always hire an independent market research team. If that is outside the budget, local home builders associations, real estate associations, and chambers of commerce often publish market reports, housing data, and economic indicators for specific regions. Additionally, the U.S. Census Bureau, local planning departments, and housing authorities publish data providing demographic information, building permits, and economic data. If all else fails, there are the good old real estate platforms Zillow, Realtor.com, and Redfin to peruse for statistics, pricing trends, and property listings.
- Continual Learning: The home building industry is constantly evolving. Those who commit to ongoing learning and staying updated on industry trends and regulations will remain ahead of the competition. Educational events like the National Association of Home Builders International Builders Show (IBS) and The Home Builder Digital Marketing Summit are key. Summits and Conferences help builders keep up with the ever-evolving industry. Monthly learning like that provided in Builder Town Hall by Meredith Communications is also a great way to keep your ear out.
As we bid farewell to this year, let’s carry these valuable takeaways into the future. The home building industry’s resilience and adaptability have been on full display. With the right strategies in place, the opportunities for growth and success in the coming year are boundless. Cheers to a promising and prosperous future in the world of home building!
Tabitha Warren was an Income Tax Accountant for 15+ years. In the first months of the pandemic, she took a chance and re-careered to freelance in Marketing. She currently, and very happily, works with video and photo editing, social media marketing, and now blog writing.
