In the current real estate economy, home builders can expect to see anywhere from an 8-10% increase in new construction starts within the coming year. This is fantastic news. The question is: is your home building business healthy enough to keep up with anticipated demand? How do you measure the health of a home building business?
At First Union, we’ve helped numerous builders with everything from procuring new equipment, to buying land on which to build, to being able to hire on more employees. We understand what it takes to get your home building firm healthy and thriving.
Understanding the Health of Your Company
Below are just a few things to keep in mind as you evaluate the current condition of your building business.
- Is it time to change up your trades? Yes, loyalty is important, but not at the cost of quality and affordability. If you’ve been using the same subcontractors for years and they’re still working out well—terrific. But what if they’re struggling to keep up, or their work is falling off? You are the owner, you have to make the tough calls.
- Same goes for suppliers. In fact, with suppliers, it can often be more important to “see what’s out there.” Your supplier might get comfortable and thus his/her pricing may become less competitive. You are in business after all—you want to be on the lookout for optimal products in combination with fair pricing.
- Are you land poor? Having too much land inventory can drag you down. If it’s not moving and no one appears to be showing any interest, then it’s probably time to go back to the drawing board and come up with a different land strategy.
- Are you communicating with clients and staff alike? Communication is at the core of everything you do as a home builder. Making sure that everyone is on the same page at all times isn’t just necessary, failing to do so could mean the demise of your company.
When reviewing your business plan, really take the time to see how you’re operating, where you’re headed and what you may need to adjust to keep that healthy bottom line. If you find you need cash for special projects or to get through a slower period—we would love to help. Our extensive experience working with home builders is most definitely to your advantage. Call today to find out how we can help you!