An Overview to Building Green

Many of the national, regional and even the local custom homebuilders are taking advantage of the housing market downturn by developing strategies and product planning that reflect the latest trends in residential design and construction. Among these trends stands a movement that the new home consumer is embracing and demands – The Green Movement.

The push for environmentally friendly housing is no secret, however if you think it is simply a temporary fad, you are wrong. The movement started long before the current economic crisis. And with experts predicting a consumer paradigm shift in values such as a stronger emphasis on long-term satisfaction rather than instant gratification, a simplified life and personal wellness, the green movement is poised to be even stronger once we emerge from this crisis.

In order to give builders and developers a clear and concise overview of building green, Marketing Specifics has outlined the following information for further explanation on what Green really means.

What is a Green Home?

By definition from the NAHB - Green homes incorporate environmental considerations and resource efficiency into every step of the building and development process to minimize environmental impact. The design, construction and operation of a home must focus on energy and water efficiency, resource efficient building design and materials, indoor environmental quality and must take the home's overall impact on the environment into account.

• Energy-efficient features: appliances, heating and cooling systems, windows, water heating systems, light fixtures, light bulbs and even the utilization of alternative energies such as solar, wind or geo-thermal.
• Water-efficient features: conservation of water through low-flow showerheads, faucets, toilets and ENERGY STAR dishwashers and washing machines, low-volume irrigation systems and rainwater collection systems.
• Green materials: increased insulation, the use of recycled materials in carpet, cabinetry, tiles and concrete as well as rapidly renewable materials like bamboo.
• A healthier home: toxin-free building materials, ventilation and moisture control.
• House orientation: the construction of smaller homes, lot position should take advantage of natural daylight to reduce the need for artificial lighting and reduce heat gain in the winter and heat loss in the summer.
• Land use: preserve trees and natural environment, landscape only native vegetation, group plants according to water needs and permeable driveways and sidewalks.

Why a Green Home?

• It is the right thing to do driven by concern for the environment, global warming, escalating energy costs and the depletion of our natural resources.
• Residential cooling and heating alone make up 20% of the United States’ yearly energy use.
• Existing buildings are responsible for more than 40% of the world's total primary energy consumption and for 24% of global greenhouse gas emissions.
• You better get on board now - Green homes are expected to make up 10% ($38 Billion) of new home construction by 2010, up from 2% in 2005 according to the 2006 McGraw-Hill Construction Residential Report and the NAHB.

What are the Benefits of a Green Home?

• The net costs of owning a green home is less that a standard home. A green home uses 40% less energy which can provide a savings of $60 to $80 a month on power bills versus a standard home.
• A healthier home means fewer doctors visits.
• Local and state government incentives such as rebates and tax breaks.
• Lower insurance.
• Discounts on mortgage rates.
• Fewer home repairs due to the use of higher quality building material.
• Higher home value as the market demand for green homes continue to rise.

What are the Drawbacks of a Green Home?

• A typical green home runs about 3% to 4% higher than a standard home (and in today’s market that additional cost will not be recouped).
• The cost saving and benefits are long-term which can be a tough selling point to buyers.
• The lack of information about performance and cost attributes of green building products can produce costly call-backs and warranty issues.
• The public’s lack of knowledge and low priority regarding building green.
• The disproportionate incentive split between builders and landlords versus the end user of a green home.
• Un-regulation (although the establishment of LEED and other third-party certifications have drastically improved this) and rampant industry “Green Washing” which is exaggerated green claims by builders and developers.

Where are Green Home Resources?

• www.nahbgreen.org – The NAHB National Green Building Program.
• www.usgbc.org - The U.S. Green Building Council is a non-profit community of leaders working to make green buildings available to everyone within a generation.
• www.builditgreen.org - Build It Green is a non-profit membership organization whose mission is to promote healthy, energy- and resource-efficient building practices.
• www.buildinggreen.com - An independent publishing company committed to bringing members accurate, unbiased, and timely green design information.
• www.energystar.gov – ENERGY STAR program helping save money and protect the environment through energy efficient products and practices.
• www.healthhouse.org – The American Lung Association’s Build a Better House.
• www1.eere.energy.gov/buildings/building_america – U.S. Department of Energy Building Technologies Program.
• www.epa.gov/epahome/state.htm - State environmental agencies.
• www.dsireusa.org - A comprehensive source of information on state, local, utility and federal incentives that promote renewable energy and energy efficiency.

For more information on developing sustainable communities or other emerging trends in Real Estate, contact Joan Barnes at 1-800-717-8999 and see why Marketing Specifics is the experts in residential development, providing comprehensive assistance and guidance in all aspects of new home communities.

NAHB Honors ‘Extreme Makeover: Home Edition’ With an Award

Posted by Laura Everett on October 21st, 2008

The National Association of Home Builders (NAHB) presented the first-ever NAHB Special Achievement Award for Contributions to the Home Building Industry to the television show “Extreme Makeover: Home Edition” in a ceremony at their board of directors meeting on Sept. 26 in San Diego.

“Through their work, the talent, creativity, dedication and generosity of the home-building community has been showcased in millions of living rooms across the country,” said NAHB Chairman Sandy Dunn, a home builder from Point Pleasant, W.Va.

NAHB created the award to recognize individuals or organizations that are not directly involved in housing that have done much to showcase the home building industry in a positive light.
“‘Extreme Makeover: Home Edition‘ has changed the lives of more than a hundred families — and inspired millions more,” Dunn said. “And more importantly, it has shown what a home can mean to a family.”

The show’s Executive Producer Conrad Ricketts, Senior Producer Diane Korman and Production Manager David Bohler accepted the award. “Builders have been part of what has made this nation great,” Ricketts said. “You’ve given individuals the ability to own a home, to have a retirement, and to put their children through school.”

More than one hundred home builders and 65,000 volunteers have donated time and materials to build homes for more than 130 “Extreme Makeover: Home Edition” families across the United States.

“You cannot meet these builders and families and not be affected by it,” Ricketts said. “When you watch your community come together it is an amazing thing to be part of.”

The Newest Amenity - Nature

Americans are spending more time outdoors than ever before, and current research indicates people want to surround themselves with nature, but do not want to spend a lot of time seeking it out.

This presents yet another opportunity for communities to differentiate themselves from competition by offering this highly-sought amenity – nature.

Across the country, consumers are seeking communities that maximize the natural environment to create distinct amenity packages that give residents the opportunity to connect to their natural surroundings.

Though many communities offer parks and green space, it will become increasingly important to offer additional opportunities to connect with the natural environment through amenities such as trails for hiking, biking and riding; parks and organic gardens; bird-watching sanctuaries; fishing ponds; paddling trails for canoeing and kayaking; children’s rope course or swinging bridge; and even equestrian amenities.

Community picnics, farmer’s markets and outdoor educational and environmental activities provide residents the opportunity to immerse themselves in nature, creating a unique sense of place that adds value for prospective buyers that leads to increased sales.

In addition to incorporating amenities steeped in nature, developers of successful nature-oriented communities must work with the existing topography of the land. By developing the land plan around pockets of trees, green space and waterways, both wildlife and the natural orientation of the land will remain intact, creating intrinsic areas for outdoor recreation. By maintaining a significant portion of a community’s acreage as open space, developers can create a unique lifestyle experience that appeals to a large number of potential homebuyers.

In addition to using nature as an amenity, it is important to create unique product offerings that reflect the consumers’ desire to bring the natural environment into their daily routine. Recent years have recorded the highest ever expenditures on gardens, landscaping and outdoor rooms. This indicates a clear trend, showing features that are important to homebuyers/homeowners. Offering landscaping packages and optional gardens and outdoor rooms can be a differentiating factor that leads to incremental sales.

There are many ways to maximize the value of land by offering amenities and home features that allow residents to reconnect with nature. Conduct preliminary research to identify the type of outdoor amenities that will appeal to your specific target market, and include these amenities that take advantage of the consumer’s desire to be close to nature.

Are you maximizing your CRM database with relationship marketing?

By now I think we can all agree that developers and builders need to rethink the way they sell. The days of simply moving units and cashing in are over...at least for a while. As we continue to explore ways in which developers and builders need to position their communities to sell lifestyle and a “sense of place,” this blog is the first in a series that examines successful techniques in getting these messages to the right people and getting one step closer to closing the sale.

Besides the community website and model homes, a community sales agent’s best selling tool is a CRM database. CRM stands for Customer Relationship Management which is basically a computer system that allows you to store information about a prospect and keep all information on prospects organized.

We’ve seen the standard questions on “request more information” forms such as how many bedrooms, when would like to make a purchase, price range interested, etc. These are all very relevant questions that help agents rank how interested a prospect may be. But it’s the behavioral questions that I want you to focus on here. If you’re not asking behavioral profiling questions (either through a website form or with your trained sales agents to put into your CRM database), you’re working in the dark. These questions are how you can begin to segment groups of prospects, and begin talking to them in a manner that is 1) relevant to their interests and 2) sells the lifestyle.

Once you establish behavioral profiling questions and build your CRM database, then what? Unfortunately, with the majority of developers and builders, nothing is ever done with this data! But this is a gold mine of information. The next step at this point is to go for the gold and mine the data. This is not a glamorous task but one that will be worth it in the end. Data mining can be performed by simply exporting your CRM database into Excel, using the sort function to find commonalities and analyzing the information.

So lets skip ahead and say that you’ve asked profiling questions and know – that Group A is highly interested in ceramic art, Group B is highly interested in hiking and Group C is highly interested in volunteer work. You then need to start communicating to these groups differently. By promoting each group’s interests and making the connection that their particular interest is an important aspect of your community’s lifestyle, you’ll have delivered a more relevant and compelling message to that prospect – getting you one step closer to making the sale.

This means more work. Instead of developing one direct mail piece, you need to develop three versions – one that talks about ceramic art, one that talks about hiking and one that talks about volunteer work. The same versioning applies for e-blasts and sales letters. This data can also be used for sales agents when calling on prospects to make a personal connection or to invite them to that ceramic class you planned at the Residents Club for Sunday afternoon.

Crunching numbers, behavioral profiling and developing multiple versions of marketing is a tedious process but it’s the right way to maximize your CRM database. Developing and sending these more targeted messages leads to more intelligent, cost-effective selling and ultimately a greater return on your marketing investment. You’ve always heard, “it’s all about relationship sales,” at Marketing Specifics, we strongly believe it’s all about relationship marketing.

Soft Amenities Combat High Gas Prices

It seems these days that no matter where you turn, you can’t escape the news of high gas prices. And let’s face it, for good reason. Gas prices are high and they don’t appear to be receding anytime in the near future. Furthermore, the high price of gas is affecting so many other facets of our daily lives, from the price of food to the amount of police that patrol our streets.

With the average commute in the United States topping 39 minutes, combined with the high price of gas, some analyst are predicting the death of the suburbs. For a housing industry still recovering from the sub-prime lending crisis, this will surely be the old nail in the coffin right?

Well…not necessarily.

It boils down to simple economics and the theory of Opportunity Cost. By definition, Opportunity Cost is the cost of passing up another potential choice in making a decision.

In other words, builders and developers need to refocus and repackage the very attributes that have made suburbia so successful. Recent studies still indicate that three of the four most important factors in choosing where to live are: safe neighborhood, close to good schools and close to parks, water or other recreation.

The point is, now more than ever builders of masterplan communities need to showcase lifestyle. And lifestyle doesn’t always require more space and a huge budget to achieve - lifestyle is a soft amenity! It’s not enough just to build the clubhouse, but you need to establish a social infrastructure – book clubs, Wall Street clubs, wine tastings, cooking classes, the programming options are unlimited. The goal here is create a sense of place and up the energy level of the community. Your residents will be paying more to commute to work, but on evenings and weekends, make it a place they don’t want to leave. This will be noticeable to potential buyers and help them in their decision process.

You can also become innovative and tackle gas prices head-on by developing Rideshare, Park & Ride and Vanpool options for commuters. Use these commuting options to help sell your project to the local government. Build a state-of-the-art telecommuting facility in your clubhouse with video conferencing.

These are just a few examples of offsetting the cost of higher gas prices in your development. Remember, it’s all about Opportunity Cost. Tip the scale in your favor.

Gas Prices and the Search for Real Estate

Yet another significant blow has been wielded against the selling of new home communities.

What is it? Simple…gas prices.

With the price of a gallon of gas now over the four dollar mark, prospective homebuyers are turning more to the web and narrowing down their searches while choosing fewer new home communities for actual in-person tours.

So it may be time to pull out some traditional marketing strategies from the past and merge them with new technologies of the present. In other words, enhance your community’s web experience by providing a simple and effective incentive for people to visit the community in-person.

And why not harness the iniquitous gas prices we all face today? One of the most successful incentives you can offer the American consumer right now is free gas. Therefore, make an investment in gas gift cards and promote this on your community website, with the hook being the gift card can be picked up at the community sales center. Some cards may be purchased in dominations as small as five dollars, all they way up to $100 - the typical cost to fill-up an SUV these days.

The following is a list of merchants offering gas cards on the web:

Chevron Gift Cards
ExxonMobil Cash Card
Gulf Oil Gift Card
Wal-Mart Shopping Card
Texaco Gift Card
BP Gift Card
Circle K Gift Card
Arco PumpPass
Shell Gift Card
Sunoco Gift Card

Or perhaps gas is a little too contentious but you still would like to utilize a gift card incentive and entice prospects to visit your community. A full list of retailers who offer gift cards can be found at:
http://www.svmcards.net/home/shop/all_cards.cfm

Which market segment is feeling the gas crisis the hardest? The active-adult market whose buyers are already in many cases, living on a near fixed income.
But the sad news for all of us in this industry – It appears that rising gas prices is yet another blow to the struggling real estate market and this latest development is destined to slow the market’s recovery time.

What Women Want? Marketing New Homes to Women

Women have become increasingly influential when it comes just about every buying decision that takes place in the American household.

In Judith E. Nichols' book, "Understanding the Increasing Affluence of Women," she says in the majority of U.S. households women bring in half or more of the income and women control about 80 percent of household spending, including new car purchases.

"Women want the same things as men, but they want more," said Ford Motor Company’s Sheryl Connelly, the company's chief marketing office manager for global trends and futuring.

Marketing to women, is definitely different, Connelly said. "Men respond to things and women respond to people," she noted. "It isn't that men won't respond to people, but women just respond differently. So, we look at this in the types and ways we advertise."

Michael Albano of General Motors’ global design group says women's influence in the automotive market has hit an all-time high, noting 85 percent of all vehicle sales decisions are influenced by women with women buying 45 percent of all vehicles.

And when it comes to new home purchases, women are THE decision makers in most new home purchase decisions. Don’t under estimate how much this phenomenon effects your bottom-line. Sensitivity and awareness of this significant and growing importance needs to be centermost in your brand experience for prospects as well as buyers, at the sale and in your service to them after the sale so that you get their referral.

In reviewing your company’s woman-friendly and focused positioning…are you giving them the detail and specifics that they need…are you giving them what they want?

 

Joan N. Barnes, M.I.R.M.