1) Where should I build next (and what makes a submarket "work")?
Short answer: Pick locations where jobs, schools, and daily‑life amenities overlap your target buyer segment. Validate with data: sales velocity, price‑per‑sf trends, inventory by price band, and competitor product gaps. Control the right land first; product and pricing follow.
- Define target buyer: family size → age → income.
- Screen submarkets: proximity to jobs/schools/amenities; historic absorption at your price point.
- Check competitor fit: plans/features/lot types you can beat.
- Control land smartly: takedowns/options; avoid over‑committing.
- De‑risk: phased releases; lineup matched to lot widths & premiums.
2) Spec vs. custom in 2025—what should I focus on?
Short answer: Most small to mid‑size builders should run a managed spec program for turns and momentum, while taking selective custom work that fits their systems. Build proven plans on "B" lots, price for velocity, and replace quickly after sale.
- Spec benefits: momentum, tangible product, even‑flow production, faster learning loops.
- Controls: mission per spec, proven plan, buyer‑wanted options, sell by/near completion.
- Custom: only when it fits your process and margin.
3) How do I price my homes so they sell fast without leaving money on the table?
Short answer: Price on comparable value, not cost. Anchor high, make the value logic obvious, and use pricing to create velocity—not just discounts. Keep prices competitive, logical, and consistent across plans, lots, and options.
- Comparable pricing: document apples‑to‑apples differences (SF, lot, finishes).
- Anchors & frames: bold top‑end anchors; descending lists; bundle framing.
- Variable margins: retail‑comparable low, structural high.
- Consistency: plan relationships and premiums align.
5) How many plans, what price spread, and what size steps should my lineup have?
Short answer: Offer 3–7 plans per community, keep base prices within ~35% width, and step sizes by 150–300 sf so buyers feel a meaningful jump in utility. Use structural options to add depth without adding base plans.
- Width vs. depth: few great plans; options for depth.
- Line logic: rising price = tangible added rooms/utility.
- Lot width dominance: product families by lot width.
- Fit to buyer: age‑restricted vs family markets.
6) How can I cut cycle time 20–30% without hurting quality?
Short answer: Control the customer and the product, overlap trades intelligently, and run a real schedule. Enforce change‑order deadlines, pre‑inspect key stages, and maintain backup subs. Shorter cycles directly raise profit via more turns on fixed overhead.
- Decision cutoffs; price changes fast.
- Build known plans/specs; standardize details.
- Get ahead of permits/inspections.
- Maintain and update a living schedule.
- Overlap exterior/interior where feasible; keep backups.
7) I've got a spec home that isn't selling—what should I do first?
Short answer: Fix value perception before price: complete the home, add high‑impact features, and sharpen the comparable story. If you must reduce price, make a decisive cut (≈2.5–5%) and replace the unit quickly to maintain turns.
- Diagnose LP²F: Lot, Plan, Price, Finish.
- Finish it; most buyers can't imagine.
- Add value cheaper than the discount.
- Reframe comps; if cutting, be meaningful once.
8) How should I price options & upgrades?
Short answer: Use variable margins: lower margins on retail‑comparable items and higher on builder‑specific structural value. Bundle to raise perceived value and use decoys to steer buyers.
- Classify: retail‑comparable vs builder‑specific.
- Set targets: competitive vs premium.
- Bundles & frames: emphasize avoided loss.
- Train sales on comparable vs perceived vs advertised price.
9) What KPIs should I track weekly to stay out of trouble?
Short answer: Watch sales velocity, traffic → sale rates, ASP & concessions, option revenue %, cycle time, inventory turns, gross/net margin, and cash/lot months of supply. Small dashboard, same day each week, ruthless about trends.
- Sales/Marketing: velocity, lead→traffic, traffic→sale, ASP, concessions.
- Ops: cycle time, on‑time closings, punch‑list at turnover.
- Finance: gross/net margin, overhead %, lot supply (9–18 months), cash runway.
- Quality: warranty claims rate, referral rate.
10) How do I control land & financing without overextending?
Short answer: Favor control over ownership early: takedowns, rolling options, and phased contracts. Target approved/zoned or improved land to cut risk, and pair A&D/construction financing with realistic absorption. Build walk‑away clauses and extensions into your contracts.
- Land categories: improved (max cost/min risk), approved, raw‑zoned, raw‑unzoned (max risk).
- Structures: takedown schedules slightly slower than need; rolling options; series of contracts.
- Deal terms: DD windows, approval timelines, staged deposits; seller gets work product if you exit.
- Finance: A&D + construction lines with absorption realism; phase releases.