MODULAR HOME BUILDER

2011 WORST YEAR ON RECORD FOR NEW HOME SALES

2012-02-02T11:49:00.000-05:00

Sales of new-home declined in December, dropping 2.2 percent, and marking the end to the worst year on record for new-home sales, the Commerce Department recently reported.

New-home sales reached a seasonally adjusted annual pace of 307,000 in December — less than half the 700,000 pace that economists consider healthy for the sector.

In 2011, 302,000 new homes were sold nationwide, overtaking 2010's 323,000 sales that had previously marked the worst year for sales on record.

The new-home sector continues to struggle to compete against discounted distressed properties that are plaguing many markets and have put downward pressure on home prices. Builders also say tighter lending standards are preventing some home buyers for qualifying for financing, and appraisals of new-homes are coming in lower on the agreed upon purchase price, causing more deals to fall through.

In December, the median sales price of a new-home was $210,300, according to the Commerce Department.

HERITAGE LOG HOMES BITES THE DUST

2012-02-02T11:34:00.000-05:00

It appears all the efforts to save Heritage Log Homes in Sevierville, TN, from the foreclosure auction may have finally and fully failed. I could not find a website for them.

The property will be sold to the highest bidder on Feb. 23. It’s a disappointing end for a once-booming business that seemed to have a couple of promising suitors to keep it from under the foreclosure gavel.

Heritage’s state of the art plant at Smith Thomas Industrial Park in Sevierville once hummed with the activity of manufacturing prefabricated log homes. However, the collapse of the housing bubble slashed its business and forced it to close its doors in 2010 as orders slowed to a trickle.

At one point, owner Bill Parsons began looking around for a way to save the company from foreclosure. Financing deals fell through and a bid to buy the property submitted by a company that said it wants to use the plant to build log homes for a South African golf course community never materialized.

MODULAR HOUSING IS THE ANSWER FOR SURGING RENTAL MARKET

2012-02-01T06:10:00.000-05:00

What type of construction can be built fast enough to feed the overwhelming need for rental housing? You guessed it....modular construction.

The share of all U.S. privately-owned houses that stood empty fell in the fourth quarter to its lowest since 2006 as the number of houses occupied by renters rose faster than the pace of new vacancies created by homeowners moved out, according to the Commerce Department.

The number of housing units occupied by renters rose by 749,000 in the fourth quarter compared to a year earlier; some 91,000 fewer homes were occupied by owners, the data show.

With the fast pace of foreclosures showing no sign of letting up, the U.S. homeownership rate continues to fall. Just 66.0 percent of U.S. homes were occupied by their owners in the fourth quarter of last year – half-a-percentage-point lower than a year earlier. That’s the lowest level of homeownership since the second quarter 1998.

The steady rise in demand for rentals has tightened the supply of housing, helping to push rents higher. Homebuilders report that the market for multi-family units has been a lone bright spot in the overall housing market. While the pace of new household formations has lagged historical averages, those new households are becoming renters.

That trend is likely to continue until would-be home buyers gain more confidence that the housing market has bottomed. Source: the Bottom Line

This is great news for both modular home factories and their authorized builders. Building a four-plex puts more money into both their pockets. Any factory that isn't preparing to adapt to this change may find that they are building SFR modular homes for a dwindling market.

Builders are usually not prepared to talk the talk or walk the walk when it comes to multi-family projects. They might have built a couple duplexes but most have never worked with a small developer that is looking for 10 or 20 units. This is where the factory and the builder need to work together.

The Dodge Report is growing fatter with all the projects coming up but there are still a lot of projects being kicked around in local planning and zoning hearings that only a local builder would know about. It's imperative that the builder jump on these opportunities and begin working with their factory to get the jump on the traditional General Contractors that use wall panels or still stick build.

If a modular home factory hasn't started to get their builders involved in the hunt for these smaller projects, they are both missing the boat.

10 REASONS BUILDERS SWITCH FACTORIES

2012-01-31T09:38:00.000-05:00

When there are enough factories to choose from, many builders jump from factory to factory for a variety of reasons and a lot of it boils down to price.

The builders that jump from one to another factory for price will always be with us but what about the other builders. Why did they jump ship?

Here are 10 reasons that a modular home builder, even a loyal builder, will leave you and begin looking for the next great factory to buy their homes.

1. The factory hires a bad sales rep. Some people should never interact with customers. Does it ever work when you hire them and try to force the fit? NO, it does not.

2. Blame the builder. Yes, builders get confused. They even do things wrong. They might not understand your process or misunderstand your rules. But please don’t get snippy. They’re just trying to support your company with our business.

3. Don't listen to their feedback. Critical feedback is your best source of improvement. If your builders are talking, listen and respond. Or…just stick your head in the sand and think you know best.

4. Don't create complicated systems. Don't force your builders to adapt to processes and systems created solely from an internal perspective. Eventually most of these new systems will be scrapped but by that time your builders will have moved on.

5. Promote the worst people. This is the Peter Principle in action. "Everyone rises to their level of incompetency." Just because a sales rep is willing to accept your Sales Manager position, it doesn't mean you should give it to them.

6. Stop being innovative. Nothing like stagnation to drive your builders away. Let your competitors innovate – you’re happy to stay in 1985.

7. Accept anyone as a builder. Don’t just accept them, ask for them to become your builder over and over. Never mind if they don’t more than one house a year. Never mind that they've been with 5 other factories before you. It will all work out in the end but not before some of your loyal builders defect because you set the bar too low.

8. Accept nobody as one of your builders. Make it nearly impossible to become one of your builders. Don’t call prospects back, don’t make it easy to find information on what it’s like to be one of your builders. Your factory is so good that you only choose the best.

9. Force your production people to use outdated, cheaper and inferior products in your homes. Now try to figure out where all your good builders went. Buying cheap means we can sell cheap and isn't that the best reason?

10. Pay no attention to your competitors. Your builders are SO LOYAL they’ll stay with you no matter what, right? They won’t notice when your competitor is providing something better. Wrong!

RHODE ISLAND MODULAR BUILDER WILL BE THE CENTER OF ATTENTION

2012-01-30T10:27:00.000-05:00

Carol O'Donnell, owner of CRM Modular Homes in Rhode Island, will be the centerpiece of the Rhode Island Builder's Association 2012 Home Show to be held March 29th to April 1st in the Convention Center in Providence.

She will be setting up a modular model home for all visitors to walk through and see just how well built a modular home is. The home is being built by KBS, a major modular factory in Maine. The one bedroom cottage will showcase CRM's skills in delivering quality homes to the New England market.

Orchard Bay Cottage, CRM Modular Homes

This is a great way to show prospective home buyers that new home construction is alive and growing despite the economy. Hats off to Carol and her effective way to let people know about her business.

CLICK HERE to read the RIBA Builder Report for February which features the home.

5 BUILDER STUMBLING BLOCKS TO CLOSING THE SALE

2012-01-27T08:49:00.001-05:00

Modular home builders are a unique breed. Since you sell modular homes, the amount of time personally "making sawdust" on the jobsite is severely limited. Your organizational skills are your most valuable asset after the sale is made and the house is ordered from the factory.

You have to make sure that everything is ready when the house is delivered and orchestrate all the subcontractors to make sure that the house is finished quickly.

But what happens if the sale is never made? No customer, no house, no income, no profit and no longer in business. In order to ensure that this never happens, you must avoid these 5 Stumbling Blocks that will kill your sale before it starts.

Stumbling Block #1: Lack or Absence of Professionalism

First impressions can come in many forms. If you are phoning a prospective new home buyer, your first impression is your tone of voice, vocabulary and conversational skills. If you are meeting your prospects for the first time on an appointment, your first impression is your outward appearance. Yet another first impression is the one given through your marketing materials such as your web site, brochures and business cards.

A positive, favorable first impression holds the key to your opportunity for a second impression and a third and fourth. Put your best professional foot forward with all you do and live to make another sale!

Stumbling Block #2: No Rapport

A sale requires trust. Trust requires comfort and confidence. Comfort and confidence requires building rapport. Building rapport requires your time and effort to engage your prospect and provide value through your actions and conversation. Unfortunately, many people think the presentation is the first step in making a sale. However, without rapport, you have not earned the opportunity to deliver your presentation.

Stumbling Block #3: Telling not Selling

Assuming a good first impression was made and that rapport has been established, many people will use their presentation to talk about all of the wonderful features their products or services possess. This is a sure-fire way to lose your customer and kill the sale. Your prospect could care less about the features. Rather, they want to know how those features will benefit them. How will they increase, efficiencies, productivity and profits? It is these types of outcomes that will draw them in to sign a contract to build their home!

Stumbling Block #4: Over-presenting and under-presenting

During the rapport building, you should have discovered the triggers that will cause your prospect to become your customer. Now, during the presentation, once you’ve addressed and satisfied those triggers, close them. Too many builders feel they have to deliver their whole dog and pony show. By going on and on about things your prospects have no concern with, their desire wanes and their excitement diminishes. By the time you are done, they want to “think about it” a little because they forgot why they wanted to buy.

Conversely, not going over enough information or simply skimming over the details can give you a quick boot out the door, too! It may be the 952nd time giving this same or similar presentation, but it is the very first time your prospect has heard it. Take the time to make sure you are as thorough as you need to be!

Stumbling Block #5: Dropping the Ball

This final Stumbling Block can be the most devastating. You’ve managed to avoid the first four Stumbling Blocks and your prospect has said they would like to buy one of your modular homes, but your job does not stop here. You need to ensure everything is in place to deliver what you’ve sold. You also need to follow-up to ensure everything is working out the way they will expect. Mishandling anything in this process could get your order cancelled and frustrate you with all of the time you lost. Worse yet, it could cost you all of the referral business that could have come your way.

PALOMAR MODULAR ENTERS STUDENT HOUSING MARKET

2012-01-26T11:36:00.002-05:00

Palomar Modular Buildings, a Texas based manufacturer of commercial prefabricated and modular buildings has announced the formation of a student housing marketing group.

This effort is designed to offer colleges and universities, along with student housing developers, a cost effective and timely answer to the burgeoning need for student housing and dormitories.

The designs that have been developed by Palomar, working with architects experienced in the student housing market, result in student housing projects that can be finished in half the time. The building modules are built in the production facility while the sites are being prepared. The follow-on assembly and finish-out of the buildings is done in a matter of weeks versus months or years.

John Martin, President of Palomar Modular Buildings, says, "Our integrated approach to designing, engineering and producing modulars with our own experienced employees and manufacturing facility keeps us engaged with our clients and industry experts from start to finish."

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The largest privately held modular home manufacturer, HIG, which owns Excel Homes, All-American Homes and Mod-U-Kraf Homes is also aggressively marketing to the university and commercial markets through its IDBS division.

NEW HOME SALES WORSE SINCE 1963

2012-01-26T11:21:00.001-05:00

Fewer people bought new homes in December. The decline made 2011 the worst year for new -homes sales on records dating back nearly half a century.

The Commerce Department said Thursday new-home sales fell 2.2 percent last month to a seasonally adjusted annual pace of 307,000. The pace is less than half the 700,000 that economists say must be sold in a healthy economy.

About 302,000 new homes were sold last year. That's less than the 323,000 sold in 2010, making last year's sales the worst on records dating back to 1963. And it coincides with a report last week that said 2011 was the weakest year for single-family home construction on record.

If modular homes are typically 4% of the total new home starts, that means that all the modular home factories combined only sold 12,000 SFR homes!!!!!

The median sales prices for new homes dropped in December to $210,300. Builders continued to slash price to stay competitive in the depressed market.

SIMPATICO BUILDS HOMES ONE AT A TIME

2012-01-25T09:08:00.000-05:00

I just watched the video below of a Simpatico home being built in a California factory.

I've really tried to appreciate what the West Coast Lego Land manufacturers are doing but for the life of me I just don't see how they can make enough money to stay in business.

When you watch the video I want you to notice two things (there are others) that just can't sustain this business model.

First is the size of the "garage" the house is being built in. How can they even entertain even starting a second house when the entire floor area is covered with this house. Secondly, all the modules are being built on cribbing which means that every tool and all the materials must be hauled from one module to the next.

If a factory is going to use cribbing for construction and they want to build multiple houses at the same time, they will need at least 40,000 sq ft of production area. Enough to pull the carriers into and out safely.

If this is what the Lego Architects think is the future of home building, they are so wrong. When the automobile was first built it was assembled in garages one at a time. Then a smart guy named Ford developed the assembly line and cars started rolling off in record numbers.

These Michelle Kaufmann types want the home building industry to go backwards by telling their clients that they will be getting better homes. Maybe they will but who has 8 to 10 months to wait around for a house to be built in a garage and finished on site? And for only $300 a square foot.

Watch the video along with some of the others from Simpatico and try not to get that deer in headlights look on your face.

READER ASKS IMPORTANT QUESTION ABOUT "GREEN"

2012-01-23T14:28:00.001-05:00

Green seems to be fading from the home builder's vocabulary lately and after a story by Trish Holder of Greenspiration published in this blog I received the following comment.

As a woman who has been planning for 4 years, off and on, to purchase a modular home that performs economically and efficiently, patience is a virtue. Codes and Certification criteria has changed and continues to do so. The devil is in the details on the craft level when putting an efficient house together and in writing up an articulate and thorough sales order to do so. I would hope that the Builders Planning Toolkit for ICC700 NAGB compliance woud assist in this process, but the publication is no longer available online, nor do builders and modular home sale reps at the buyer contact level know what ICC700 is - even when it is part of their website. All I want is what one of the websites states: "How to go about planning a home that qualifies for one of the levels of ICC700". Thank heavens I have patience and I have 2 more years.

What are we telling people that want a "green" home?

Has the modular housing industry really dropped the ball? I would like to hear from you about the future of "Green."

INTERVIEW WITH 4 TOP MODULAR HOME FACTORY PEOPLE Part 3

2012-01-23T11:48:00.000-05:00

I’ve often talked about a love/hate relationship between the builder and the modular home factory. Do you see this love/hate relationship when you talk to existing modular home builders, either yours or another factory's?

New England Factory Owner:

We run into builders with this love hate relationship.......bottom line.....when this exists, it is typically because the manufacturer has one interest and that is to have the builder call when they have an order otherwise they provide no sales support. Our success and our builders success is in large dependent upon the strong long term relationship we build based on trust and support. The builders that do not jump ship from these manufacturers are probably doing so because their primary focus is on price and how cheap they can purchase a home instead of support and providing value to their customers.

Southern Factory Sales Manager:

Aside from the squeezed margin impacts mentioned above, much of the discord I see between builders & factories comes from continued lack of understanding of each other’s business models. Builders rarely grasp the tremendous costs that saddle a factory operation and often over-estimate earnings. Factories rarely have people on staff that have been on the front lines in a sales/build situation. As a result, both sides have over-simplified impressions of what the other one does. We factory folks think we have some simple answers that – if applied by the builder – would fix them...and vice versa. I think factories should invite key builders, open up the statements and really show them how they are structured. Factory folks should spend time with the builders in the field, join them for customer meetings and really see how difficult it is to manage the “human element” that makes up a customer (us factory guys have hundreds of employees who generally march in step with our requirements…sometimes making it hard to envision that not all people are as easy to control…particularly customers who buy our houses).

New England Factory Owner:

The love/hate relationship you mention is wide spread in the modular industry. A great deal of it is caused by the low price/ low quality/ low service cycle that many low end builders and manufacturers play, as I described before. Builders and manufacturers who sell on price alone and produce low quality homes will remain stuck in the love/hate relationship. The focus on low price/ low quality is also what is holding back the industry from gaining share.

There are also conflicts that come from both the builder and the manufacturer trying to control their business without understanding or caring about the needs of the other business in their supply chain. Our company rarely tries to attract existing modular builders because they usually have been trained to sell on price alone and do not approach the manufacturer relationship as the partnership it must be, nor have they developed a reputation for quality. Instead we try to convert quality stick builders to modular and train them on how we can best work together for mutual success from day one. We also try hard to understand what they are facing and keep communication open at the senior management level. Backing that up with strong and responsive service helps to greatly reduce the conflict. That is not to say we operate with out any builder conflict, but when it arises we try to address it head on, find the root cause, and find a resolution. As a result we have very low builder turnover, and a growing network of Builders.

Mid Atlantic Factory Owner:

It is a love /hate. We both want the same things, but seem to have a contest going on to see who gets more of it. You hear all kinds of stories from all different perspectives from builders and there are some common threads.

“My manufacturer does not communicate with me enough”

“They have not given me a lead in 6 months”

“Their website is not doing the job for them, they need to change it”

“They have not developed a support system for their builders that is reflective of the times”

They don’t want to make changes to their product, specifications, marketing etc, etc…..” And the list goes on.

RELATED ARTICLES:
Part 1
Part 2

50 REASONS YOU WILL NOT MAKE IT AS A MODULAR HOME BUILDER

2012-01-23T10:49:00.001-05:00

Some people make great new home builders while others struggle to get their business off the ground.

With that in mind, here is my list of 50 reasons you might not be right for the home building business.

The thought of working a 16 – 19 hour day makes you feel violently ill
You sleep in past 10AM most mornings
You don’t know what the word “work” means
You hear the words "Energy Star" and you think someone is talking about Beyonce
When meeting clients for the first time, you wear jeans, a t-shirt and muddy boots
Your hair is a mess, all the time
Your phone manners are terrible (you answer with "hello", and nothing else)
You don’t understand what a "Final Print" is
Your business card is a home-made Microsoft Publisher job
You have never started conversation with a stranger
You are not confident
You are not likeable
You do not manage your personal finances well
Even your Mom doesn’t like your design work
You want to be successful, but your drive is completely lacking
You are not self-motivated
You don’t have a desire to be the most successful person you know
You don’t have a website
Explaining the difference between modular and site built is like speaking a foreign language to you
You think open space is wasted space
The “delete” key on your computer doesn’t work anymore because you have worn it out so badly
You struggle to actually complete a project
You have to give your clients money back because you over promised on your ability
You have Zero business skills and have no idea how to develop them
You really dislike sales and feeling like a sales person
You don’t make your clients sign contracts
You think it’s cool to be flaky and disorganized because that is what "us creative types are like"
You think you are right, and the client is wrong
You think that your prices need to be lower than anyone around so that you can get the business
Your people skills are terrible
You don’t have a plan for your business, you are just floating along
You don’t really understand what marketing is
You haven’t developed a brand for your home building business
You are unable to save money
You don’t have a desire to continue learning all the time
You have never worked more than 40 hours a week in your life
You have never worked for a construction company
Seeing a logo you designed on a billboard or on TV doesn’t give you a rush
You design things that look good but don’t match the customer’s needs whatsoever
You spend most of your time surfing on Facebook and Twitter
You let clients name their price
You’re not a risk taker
You do not manage your time
You are not disciplined in a daily routine
You don’t study your competition
You don’t even know who your competition is
The word "change " makes you cringe
You suck at bookkeeping
You don't follow up with any requests for information
You are guilty of over 20 of the points above

MY KUNG FU GRANDSON

2012-01-22T06:51:00.000-05:00

My flying Kung Fu Grandson, DEAN

Turns one year old this week

FACTORY SALES REPS ARE THE KEYSTONE TO MODULAR HOME SUCCESS

2012-01-20T09:55:00.002-05:00

Factory sales reps come in all shapes, sizes, knowledge and charisma but they all share one important trait; they are the key to both the modular factory and the new home builder’s success.

To better understand why they are so important you must first look at the non-modular home builder. There are two basic types of site builders. Tract builders build hundreds and even thousands of new homes every year. They typically have a staff of designers, sales people, management and supervisory people that handle everything and keep as much as they can inside their organization.

The other group of site builders builds less than a hundred homes a year with many only building a handful. The owners are sole proprietors, partnerships or LLC corps. They also try to do just about everything themselves for their customers from design, to selling and marketing, advertising, scheduling labor and materials, job site supervision, accounting, customer relations and so many more things that you start to wonder how they can do all that with only 24 hours in a day.

But the modular home builder has a partner is this game that can make the builder a “superman.” It’s the factory sales rep.

When a factory hires a sales rep, they are entrusting them with the success or failure of both the factory and the builder network. Seldom is this explained to the sales rep by anyone within the factory organization. If the sales rep does what he or she is supposed to do, everyone wins, especially the builder.

So why is the sales rep so important?

They are the keystone that binds the factory with the builder. A good sales rep insures that the builder’s customer’s wants and needs are met by the factory. They are the ones that send information back and forth between the builder and the factory.

Sales reps help builders with design, costing, new product availability and much more. They provide the builder with someone to talk to about running their business. Leads generated by the factory website are usually given to the builder by the sales rep. The rep is also the host or hostess when the builder’s customer visits the plant. But one of the biggest things they do is to catch hell when something goes wrong with the home. Late production run, delayed delivery, repairs, customer complaints and poor factory quality are just part of the everyday job for one of these heroes.

So how do most factories train new sales reps and continue to teach them about marketing, product improvements, new procedures and customer relations? The factories rely on the Sales Manager. If the Sales Rep can make or break a factory, the Sales Manager can make or break the Sales Rep.

Factory owners need to not only look to their Sales Managers for more sales, they need to look to them for continuous improvement in the sales rep’s performance and this is only accomplished through training and constant attention to the sales reps needs. Good luck with that!

HOMEBUILDERS UPBEAT - FINALLY!

2012-01-20T07:00:00.002-05:00

U.S. homebuilder sentiment unexpectedly jumped in January to its highest level in four and a half years, suggesting the housing market is starting to heal, the National Association of Home Builders said on Wednesday.

The NAHB/Wells Fargo Housing Market index rose to 25 from 21 the month before, the group said in a statement. Economists polled by Reuters had predicted the index would hold steady at 21.

It was the highest level since June 2007 when the housing market was crumbling. After stagnating in a tight range for about a year, the index has been improving since October 2011, reinforcing optimism the housing market is finding a bottom.

Still, the index is a long way from the 50 mark, indicating more builders view market conditions as poor than favorable. It has not been above 50 since April 2006.

I WOULD BUILD A MODULAR HOME Part 2

2012-01-19T10:45:00.002-05:00

Last week I sent over 1,100 emails to people on Linkedin, Facebook and in my Google accounts asking them for their help in answering a question about modular homes. The response was overwhelming with almost 400 people replying.

Some of the responses came from modular industry people but there were quite a few that just knew that modular was the way to build their next home.

Some of the responses were so detailed I am going to put them into several articles. Here is Part 2.

Here is my email:

I've been writing Modular Home Builder for over 5 years trying to explain to both new home builders and new home buyers why modular is a great way to build a home. But something happened today that stopped me in my tracks. I was asked if I were looking to build a new home, would I really consider building it as a modular?

Of course I would but would you?

Here is where I need you help. If you were looking to build a new home right now, would you look at modular as an option?

Absolutely! The first time I walked into a homebuilding factory, I was absolutely sold. I don't know why anybody would want to build a home any other way.

Kathleen
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No I wouldn't. Twelve years ago I bought a modular home from Design Homes in PA and had a bad experience with both the builder and the Township inspectors. Design Homes built my wife and I a cape cod but there were so many things wrong with it that the builder gave up trying to finish it because they wouldn't help pay for his repairs. Then the inspector gave us a hard time about the entire house. It took us a year before we could move in and another year to sell it so we could buy another home. Never again.

Anonymous (wanted his name withheld)
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Modular is definitely the preferred option here in the upper Midwest. Factory built modular production lead times are typically right in sync with site well/septic, flatwork & basement preparation timing. This allows efficient scheduling of sub-contractors with parallel processing to get folks into their new homes quicker than stick built. Thus allowing customers and building contractors to optimize our limited seasonal build window.

Jay K. McDonald
Manager
Lancaster Division of Skyline Homes
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Read more »

10 SURPRISING REASONS YOU CAN'T GET A HOME LOAN

2012-01-18T07:09:00.003-05:00

Getting a home signifies financial security and an investment for the future. Owning a home is part of the American Dream.

There are some surprising reasons why you can’t get a home.

Down Payment – You may have the required 10%-25% on the asking price of the home you are interested in but how you acquired it and how long you’ve had it could keep you from getting the home. Many times relatives offer young couples the down payment. Lending institutions take this into consideration when looking at the ability of a homeowner to keep up with mortgage payments. Saving the down payment over time lends to the credibility of money management.
Credit – Credit history is an ongoing process. Student loans are one of the first obligations a person may have as an adult. Late payments may have a bearing on your ability to acquire a home later in life. Credit scores are also affected by utility payments. Any recurring bill that is paid late may come back to haunt you even though your financial situation is now more sound. Your debt to income ratio ideally needs to be under 45%. Less than a 3 month asset reserve in a bank account will generally keep you from getting a home. Check your credit score with all 3 agencies and make sure there is nothing being reported incorrectly. You need to aim for a score of 660 or better.
Job Security – Your job history may be why you can’t get a home. Lenders look for stability. If you jump from job to job, regardless of monetary or career improvement, lenders see you as a financial risk. When the economy takes a downward turn, employers tend to retain employees with seniority. Also taken into consideration is the risk of the job.
Parent History – If your parents have a questionable credit history, you may be dealing under their shadow. If parents foreclosed, you may be affected. If they were late with mortgage or credit card payments, you may be looked upon as having the same traits. If you are asked information on parent particulars, you may need to look elsewhere for home financing.

CLICK HERE to read the rest of the reasons

I WOULD BUILD A MODULAR HOME - Part 1

2012-01-17T09:54:00.000-05:00

Some of the responses came from modular industry people but there were quite a few that just knew that modular was the way to build their next home.

Some of the responses were so detailed I am going to put them into several articles. Here is Part 1

Here is my email:

I've been writing Modular Home Builder for over 5 years trying to explain to both new home builders and new home buyers why modular is a great way to build a home. But something happened today that stopped me in my tracks. I was asked if I were looking to build a new home, would I really consider building it as a modular?

Of course I would but would you?

Here is where I need you help. If you were looking to build a new home right now, would you look at modular as an option?

Yes I would build modular. I have been in the modular industry starting the summer before I entered college. When I was in architecture school my designs were modular based. You see to me MODULAR is not an "option". It is the only way to build

John Erb
VP Sales and Marketing
Deluxe Building Systems, Inc.

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I have been around the modular industry for 30 years now and have come to the sobering conclusion that the modular mystique is over. One company has on their web site these awesome concept homes from architects to show what they can do but they admit they can't build them anymore as they are too time consuming. Another company wants to be like the previous mentioned company and will offer to do just about anything the other company will do but with the unskilled labor force they use the quality is just not there. These companies need to understand their place and do what they do best.

In light of the afore mentioned issues with the industry I would pick a company, any company that understands the Net Zero concept or Super Home. A very high energy efficient process in my opinion that allows our industry to compete with the on site stick builder. We build from the inside out and they from the outside in, making it very hard for them to achieve the same energy rating at the time of blower door test.

The company that can build me a home that is 15% lower than the energy star 85 without a lot of side stepping before they say the'll accept the build and can give me a price with out waiting 2 weeks is the company I want to do business with. The bells and whistle fluff is just that, Fluff.
Give me Net Zero and I'll by it!

Tim Watson

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WESTCHESTER HOMES LOVES YOUTUBE

2012-01-17T09:18:00.002-05:00

Westchester Homes in Wingdale, NY uses two things to help their authorized builders get an advantage over the competition; Chief Architect 3D software and YouTube! They know that professional videos that their builders can use to introduce prospective new home buyers to modular home construction pays big rewards for all parties.

Buyers get to see what their new home will look like in 3D before it's built.

Enjoy Westchester Homes latest video:

INTERVIEW WITH 4 TOP MODULAR HOME FACTORY PEOPLE Part 2

2012-01-17T08:54:00.003-05:00

A while back I asked several modular home factory owners and top management people some important questions that effect their relationships with their new home builders. Here is the answer to the second question I asked. I've kept their identities hidden.

What value are modular home manufacturers willing to bring to the relationship to hold the loyalty of the builder? Marketing support? Sales support? Leads?

Southern Factory Sales Manager:

We strongly believe that our function as a sales/marketing department is to sell “through” the builder rather than “to” the builder. I don’t believe that’s a concept many of our competitors grasp or aspire to. We live & breathe it here. It was a tough transition as we shifted funds from steak dinners to website improvements, but we rolled the dice believing that if we could provide our builders with leads and powerful tools to close those leads, they’d ultimately be more loyal because the lifeline of their business depended on our marketing assets. It has paid off considerably as we had tremendous retention rates during a difficult bankruptcy and now enjoy a backlog that is out through the end of the year despite building 40% more production per week than we did this time last year. Frankly, I’m always amazed that in an industry that only builds 2-3% of all residential construction in the country we often find ourselves so focused on the pie we’re all sharing that we often ignore the other 98% of all construction that makes up our “opportunity” for expansion for both our industry and our individual companies. Like rats fighting over crumbs when there’s a table full of food right within our grasp if we simply looked outside the boundaries of our little skirmishes.

New England Factory Owner:

If a builder is willing to make a 100% commitment to our company we will provide them with all the leads from the territory that we mutually agree upon. In addition, unlike many other modular companies, we participate in putting together advertising campaigns with the builder......in many cases, we develop the ads (radio, TV, Print, billboards, Internet, etc..) and we participate financially in the media campaign.......hell, we place the ads and accept billing in some cases depending on the quality of the builder. Quite frankly, we would not make this commitment to a builder who was purchasing from multiple companies since the lines get blurred and I can not advertise and provide extreme sales support such as Chief Architect training, sales training among many other things.

New England Factory Owner:

There seems to be a wide range in the level of support provided by different manufacturers. Our company has very low builder turnover and we provide far more support than most builders are willing to take advantage of. We provide all of the items you mention and more. However, most builders do not invest much time or money in marketing, so the sales and marketing support is under utilized, but still important, assuming some of it gets used. Sales and marketing support gets taken for granted and does not generate loyalty, other than if it generates a volume of "quality leads." Quality leads are those who end up buying. So loyalty comes, in part, from giving builders easy to close sales.

I think the most important factors for loyalty are mutual trust and service, at least when dealing with quality oriented builders. There are many builders in the industry who compete purely on price. They jump from factory to factory to save 25 cents per sq ft, only to be frustrated by the lower quality that allowed the lower price that attracted them in the first place.

Mid Atlantic Factory Owner:

Every one of us has developed programs that’s we believe are there to support our builders and their efforts. Some are very, very, sophisticated some much less complex, but all have customers that’s use them to the extent of their abilities. The Internet has been the single largest advertising and promotional tool that has come along since I have been in the business. Sending leads to our builders generated by our internet presence has done much to gain customer loyalty as it pertains the lead(s) that’s a factory sends them. But honestly, can a builder that is suffering accept a lead from another manufacturer, when offered and remain loyal? There are some that do and will and then there are those that don’t.

RELATED TOPIC:

INTERVIEW WITH 4 TOP MODULAR HOME FACTORY PEOPLE - Part 1

NEW HOME SALES FLAT GOING INTO 2012

2012-01-17T06:30:00.001-05:00

Thanks to Calculated Risk for the following graphs.

IRONTOWN HOMES KNOWS THE POWER OF TV

2012-01-16T16:27:00.002-05:00

Irontown Homes, Spanish Fork, Utah, sold a couple a new modular home and instead of just delivering it without anyone knowing about it like most factories do, they contacted the local TV station who sent a crew out to record the set, interview Iron Town's owner and the new home owners.

Now this is how our industry should do it!

COLD CALLING DIED

2012-01-16T14:53:00.003-05:00

I hate to break this to all those modular home factory Sales Managers and sales reps but cold calling died a quiet death last week. What replaced it is something you need to embrace right now.

It died because every new home builder has heard of modular home construction and has put up barricades to keep you from calling them even though modular construction is fantastic.

So if cold calling is dead, what can you do to get new builders to visit your factory and buy into modular housing? You must start using "inbound marketing."

Facebook, Twitter, Google+ and blogs are the new way to get builders to learn about you. If you don't follow social media sites because you think they're lame, guess again. They are still hot. Getting builders to "like" you is easy and then you've got them listening to what you have to say.

One of best ways to get that builder to call you is to send them an email with a link to a third party website or blog with an article about your factory. Whenever you find a good article, whether it is in a newspaper, on TV or YouTube or here on Modular Home Builder, simply send it to your targeted builders with an invitation to visit your factory. Good news is always better from a third party. NEVER send a prospective builder a PR Release. You might as well write Spam all over it as they will probably block your next email.

That's all it takes. Let them take the the initial step by contacting you which means they want to know more. "Home Court Advantage!" Inbound marketing.

If you can't find anything about your factory to send to your prospective builders, you're screwed. Others that actually have good things said about them will get to those builders instead. If your factory doesn't have good articles written about it, write something and send it over to me at modcoach@gmail.com and I'll get started on writing an article you can share.

This is such a low cost, high results effort that it would be a shame to overlook it and continue to call and call and call without ever getting to someone that could actually make a decision.

MUNCY HOMES LAYS OFF 29 EMPLOYEES

2012-01-16T03:40:00.001-05:00

Economic conditions led to the layoff of 29 employees last Friday at Muncy Homes Inc., 1567 Route 442 Highway, Muncy, PA.

Michael J. Clementoni, executive vice president, said they have been considering the lay offs for the last three years, but held off until now because he said he does not see a sign of improvement in the foreseeable future.

Muncy Homes complex in Muncy, PA

The 29 employees that were laid off are a mixture of management, supervisory and administrative employees.

Muncy Homes Inc. now employs about 220 people. It has been in business since 1973.

The company has manufactured modular homes under three brand names: Muncy Homes, Superior Builders and Premier Builders. The manufactured modular homes are delivered in 14 states in the northeast.

BLU HOMES CLOSES EAST COAST PRODUCTION LINE

2012-01-16T03:33:00.000-05:00

Blu Homes, the unique systems built home company founded on the home plans of the now defunct Michelle Kaufmann Designs modular factory is itself closing one of its two plants.

The Blu Homes factory in a former aircraft plant at 330 Chestnut St, East Longmeadow, MA, had about 40 workers, including carpenters, electricians, plumbers and metal fabricators. They assembled sections of Blu’s modern-style homes then used the factory’s huge 250-ton crane to lift the home sections onto truck for shipment to building lots across the Northeast. Some workers will be offered opportunities to continue working at the Vallejo, CA location, 3,000 miles away.

Blu Homes factory in Vallejo, California

Sales for their folding homes have shifted to the West Coast. With demand there it makes more sense to build the homes in their new Vallejo, California factory rather than ship them across the country. That makes sense considering how much it costs to ship cross country.

What doesn't make sense is that they will continue to have a sales office and staff on the East Coast which means shipping back to the east will be cost prohibitive. Looks like another West Coast modular company just can't make it in the East. I could have told them that.

Related stories:
Blu Homes 3D Configurator
Blu Homes opens West Coast factory