It took 52 weeks, but what was predictable happened.

New homebuyer behavior changed. It does that.

For 52-plus weeks, everything homebuilders did – and they did extraordinary things to make the buying process fuss-free, less unwieldy, safe, appointment-driven, seamless, speedy, and digital – worked.

Now, homebuilders face a new challenge: What specifically really worked? What will work?

Maybe start with a reframing. Forget homebuyers. Instead focus on her, him, them, the couple, the single household traversing that tough path from where they are to a new home.

More than 10 years now of suppressed homebuilding production capacity – where demand for new homes has more or less constantly exceeded the number builders were able to develop and build — may well have dulled the senses, numbed many to the reality, and, in some cases, just not offered some younger associates time-tested experience of how downturns work.

When new homebuyer behavior shifts, a lot of homebuilding company associates’ job descriptions change. It can happen almost overnight.

They were “order takers.”

Now, they’re selling as if their livelihoods depend on it.

Earlier this week, Rose Quint, National Association of Home Builders assistant vp for survey research, brought evidence to light

Source: Denim Marketing

It seems like as an industry, follow up is a little lax,” says Carol Morgan, president of Denim Marketing, which teamed up with Melinda Brody & Company and Blue Gypsy Inc. on a second annual Online Homebuyer Mystery Shop Report, with insight into homebuilder sales process communication and practices. “We need to button this up as we look to the future and work to build up the customer experience.”

Here’s what’s likely.

  • Builders, because they’re problem solvers, will ultimately navigate their way through supply chain shocks, and arrive at a modified start-to-completion schedule based on their ability to patch together a resource-flow.
  • They’ll continue to test price tolerance levels of an economically-modeled buyer universe, even as interest rates ladder up.
  • Their challenge will be, not to out-produce, but to outsell – as inventories track upward, competitors – including resale bring more to the market.

The fact that corporate private equity and build-to-rent community developers have become full retail price buyers of many builders’ entry-level offerings should not blur recognition that the days of order-taking are numbered. The days of selling, not to homebuyers, but to a prospective buyer who’s going to have options – including waiting – are here.

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