Instant gratification is an expectation that has been under construction for decades. Some of us remember when we had to use an oven to cook a meal. Then came the first microwave, which did in minutes, or seconds, what took the oven more than an hour to accomplish. That mindset has since expanded into other areas. Amazon started it with books, Dell did it with computers and now Carvana does it with cars. The result has been to raise American consumers’ expectations for instantaneous fulfillment.
But buying a home is different, you say. Or, is it?
With the way most building is done today, it is different. It can take weeks to price a single home, especially a custom home. The effort to collect all the information about the materials and to keep up with ever-changing prices is the first hurdle.
Then there’s the labor calculation. Exactly how long will it take to create that coffered ceiling the customer requires? And don’t forget site work, which of course happens outdoors. Will it rain? If so, how many days of delay will that add to the job? Is the work taking place in the winter in a northern state? If so, what will it cost to heat the home while the interior finishes are being done? These variables are hard to predict.
The conventional process needed to create an estimate or quote for a home is difficult, to say the least. It’s not even close to the speed of Amazon, Dell, or Carvana, all of whom can price products almost instantly.
But as I said, people today want you to give them a house price now, not a month from now. The homebuyer doesn’t understand, or care about, what I just described. The age of the “Buy Now” button is upon us for home construction. How do we respond?
In fact, the technology already exists to create it.
- A builder or developer using offsite modular construction can fix the invoice for 50% or more of the build at the factory level.
- GIS systems, which are map-based, can perform analysis, share information and solve complex problems for a specific building lot. You can now calculate how much soil needs to be removed for your 9 ft.-tall basement on your specific lot, for your specific home…from your couch. It’s a game changer.
- There are home configurators that let you select colors and options, and that include pricing.
Taking the data generated by technologies like those above, and combining it with a 3D computer model of a home plan, lets you calculate the cost of a home in real time.
However, we still need to make the calculation process simpler and more streamlined. How do we get to a point where a homebuyer can get approved for a construction loan, choose a home design, configure it, see it on their lot, get a real price, generate a contract and sign the contract, all while sitting on the couch?
I believe it will happen soon — in the next couple of years, in fact. By combining already existing digital technologies with offsite construction, the ability to provide a Carvana homebuying experience is upon us! Offsite construction will be the great enabler for a new way that America will buy its homes. Which offsite construction company will be the first to deliver the “Buy Now” button to America’s homebuyers?
If you liked this article, you can follow Ken Semler on LinkedIn, where he offers daily insights and commentary about offsite construction.
