Build Cast
Build Cast
Unlocking the Formula for Success: Effective Communication and Collaboration in the Home Building Industry. Ep3, Season 3
What if there was a formula to ensure successful collaboration between builders, realtors, and lenders? Get ready to unlock the secrets of effective communication in the home-building journey during this insightful conversation with Brian Hurd, Natalie Roberts, Jenn Saladay, and Tony Villareal.
Prepare to be inspired by Tony's story as he shares how he entered the home-building industry and the importance of trust-building and communication among professionals. And, in her second consecutive appearance on the show, Jenn dives deeper into what she appreciates about the relationship between Realtors, Builders, and mortgage lenders and how a solid team can expertly guide prospective home buyers through this journey.
We dive deep into the challenges of breaking into established relationships and the significance of reverse engineering success in the building and remodeling industry. From discussing lender communication to exploring creative finance solutions for first-time homebuyers, our conversation covers all aspects of the home buying process, emphasizing the need for education and transparency. Discover the role of technology in bridging communication gaps and the importance of evaluating material take-offs when building a home.
As we wrap up our conversation, we emphasize the value of returning to basics and building genuine connections with builders, realtors, and lenders. Delve into the importance of face-to-face interaction and creating raving fans as we remind ourselves to be good humans. Don't miss this opportunity to transform your home-buying experience and solidify lasting professional relationships.
To connect with Jenn Salladay, visit her website at JennSalladay.com or call (512) 818-6146.
To connect with Tony Villareal, visit Build 512 or call (512) 855-2945.
Subscribe to BUILDCast on your favorite podcasting platform or visit us at https://buildcast.buzzsprout.com. For questions or to suggest other topics you'd like to hear more about or to learn more about Thrive Mortgage, please contact us at BUILD@ThriveMortgage.com. You can also see the video of all BUILDCast episodes on our YouTube channel at YouTube.com/ThriveMortgage. Thanks for tuning in!
Thrive Mortgage is an Equal Opportunity Lender, NMLS ID #268552.
Welcome back everybody. Episode five of Buildcast My good friend, Natalie, Good to be back. Ryan Hurd of course You all know my name, though. So we've got Jen Saladay with Koopa Sotheby's I don't want to say it like that And then we have Tony Villareal with oh gosh, Build 512, Alabaster Custom Homes 12 Stones Build 713. What else am I missing?
Speaker 2:Build DFW new brand up and down.
Speaker 1:So really excited. So we start episode four. Jen, you were with us. We started the conversation of the relationship between builders, realtors and then ultimately lenders, and it's not always Shangri-La. So what we really wanted to do is have Tony come in today and add a little extra flavor to that conversation And reminder this is a no holds barred grudge match. No, i'm just kidding. Get in the ring.
Speaker 1:Yeah, we really want to have very honest and open conversation, because I think it's a really important thing. I mean, ultimately, we're all real estate professionals, we're all working towards the same goal, so how do we work more effectively together, right? What am I missing?
Speaker 3:I think that's it, ryan. You know, when we think about who you said it earlier when we think about who, what's the end goal? And the end goal are the homeowners closing on that house and having a team on every angle that supports getting them to the finish line.
Speaker 1:And everybody at this table. Yeah, we're all part of that tripod, that team that you just mentioned. We just got started acting like it, exactly. Yes, we're all on the same team.
Speaker 3:We are We're?
Speaker 4:all in this together.
Speaker 1:So just to kind of recap a little bit from the last episode, speak a little bit, if you would, about the relationship with realtors and builders, because you know you've been a real estate professional for how many years 10 years, 10 years And you work with a combination of resale, new construction, everything in between, correct? Yeah, if you can give just kind of a little background on where you see that relationship, how does it look? good, bad and ugly.
Speaker 4:I would love to say it's amazing every time. That's not the truth. Unfortunately, it's not always that. But I mean, i think, my relationship with builders I've had some amazing builders where we're holding hands the whole way to the finish line and we're celebrating, we're cheering each other and maybe you know, this wasn't explained well and I can step in, or that wasn't explained well and they can step in. So I think when it works, it works, It's amazing, the client feels great, they get all the warm and fuzzies and they know, at the end of the day, they got an amazing house and they felt supported. But there's a lot of times where maybe it doesn't work out that way And you know, i think every situation is different and I do think, you know, every buyer should have a realtor to help them throughout this process. Now, are builders always amazing? No, are realtors always amazing? No, it kind of falls on every side of this deal Lenders are.
Speaker 2:Lenders are great.
Speaker 4:They're like chopper I mean, but it is hard. So I wish all three pieces of this came together, and a lot of times it does and it's magic. And those are the clients that come back and repeatedly buy from everybody. They go back to the lender, they go back to the builder, they go back to the realtor. So you're building long-term clients for life if it all can work together. But one person or one part of this you know symbiotic relationship if it's not working, the whole thing can go down. And that's where I think a lot of times we just kind of have to put our egos aside and work together. And again it's all about the client.
Speaker 3:So I have a question on that. So hearing you say that, can you? is there a consistent point in the home buying journey where you see it slide off the rails?
Speaker 4:I think after an inspection it's one of the places where it can slide off the rails And I think the incentive getting kind of that final CD and really understanding the lending I've always felt like it's kind of at the end. It's not as much at the beginning, And maybe that's just my most recent transactions that I'm speaking to, where it's kind of in the final hours, where maybe we're just not getting the answers and we need to kind of come together and get there. But that's typically where I see it.
Speaker 3:You know what's interesting on that and kind of floating over to you and the processes that you've got throughout your company is on. What is the construction flow? How are the updates being made? How are the construction teams outside of the sales teams? Are they being trained to work with the buyer, with the realtor, And could that somewhat lessen?
Speaker 1:Instead of just sign a contract, sign a contract.
Speaker 4:Yeah, it just hit me with that, But they feel like a cog in the machine. It's like the worst place to be as a buyer. I think You want to feel special.
Speaker 1:Much further. Let's get a little background in you. So Tony is one of my absolute favorite human beings in the industry And otherwise. You'll never meet a more genuine man. He loves podcasts. He's really excited to be here And I know you hate talking. It's also incredibly humble, despite all those 2000 brands that he has. Why did you get into home building in the first place? If you don't mind me asking, I grew up around it.
Speaker 2:My grandfather built both of his homes. I think once I got into corporate America and I pursued what my passions were, i realized it was always this reset. I was around it as a kid. It's what I loved, it's what my passion was, spent the last 12 to 13 years of my life in corporate America in the hospitality industry and realized that it was probably the missing component in construction. So I'll speak to what y'all were talking about first, as a home buyer.
Speaker 2:So before I started my own company, we built or went through the process of building a production home I won't mention the builder in a community in Georgetown. It was an awful process. It was one of contention. It was one where we weren't partners in the process. It was very transactional. And so I think, as a builder and I don't build production homes, we build custom homes, we do high-end remodels and additions, but our entire focus is to be partners in the process, because if all I get is a sale and a transaction, then we failed. We really strive to create partnerships and lifelong relationships And if we haven't done that, i could care less about a review. But I want all future sales. I want their pediatrician, their neighbors, their mother, their dog walker, and so if all I get is their money on one transaction, i feel like we've I mean that essentially your clients.
Speaker 1:They are your most economical and strongest advertising referral source, whatever you want to call it, and I think we're all guilty of this. But you know we need to look far beyond this transaction. You know it's like I always say. You know our fiduciary responsibility is to the buyer, but we want every deal that you do, we want every deal that you do and we want every deal that comes from family, friends and otherwise. And I think that's where we have to make sure not just at the last minute going, hey, submit a Google review and give me five stars. You know it's checking in. You kind of mentioned already communication checking in a long way say, hey, how are we doing? we doing exceptional? are we falling short? and you know I've never liked that car sale model where they literally will call you after you sign it, after you close on your car, and say, hey, you're gonna get a phone call like you to give me a five-star review yeah, and from a marketing.
Speaker 3:You know, on an internal home building perspective, one thing we always look for and in the top three lead source is referral. And who is that referral? how are we nurturing that? to your point, if Mrs Smith comes in and you know the trust is built and the connection is made, she's going to naturally give you that review because she wants her pediatrician, she wants everyone to know hey, this is, this is a great builder, he has integrity, he's walking us through this, we're in a partnership. So you don't even have to ask for the review when you've stepped into a space of communication, it just comes very true the challenges you have to create raving fans yes
Speaker 1:you know, because what is the net promoter score? you know if it's a seven or eight. Okay, that's a good review. Those people are not going to be the ones that are going to go out there and proactively sell the nines and especially the tens. Those are the ones, and that's what we really all need to work together on doing is, how do we create that? so would really love to hear from me that one of you, both of you on the challenges to that end now and let, then we can start going into how do we fix it, you know. So I mean, it will just start with you first, you don't mind. I mean, what are the biggest challenges you're seeing right now? and in that builder, realtor relationship and lender?
Speaker 4:I think communication again it always comes down to communication. There is some flaw, something broke apart, someone didn't explain something. I love when a builder can send a weekly check-in, or especially if you have a really long build, like you know. Sometimes you may not hear from a builder for months and they're out there yes, nobody's there and like, well, this is normal, this is normal.
Speaker 4:But it's not coming from the builder. Sometimes, and you know I can be like well, it'll go from like no walls to suddenly walls and cabinets, like it'll be a really quick process and I want you to know this and this is what's coming. But sometimes the builders really good about it, and then some built times. You know it's just crickets, there's no communication, so the client doesn't know what those timelines are. Or if something gets delayed, like refrigerators and appliances and you know we can't, that's outside of our control. But if you manage those expectations and communicate that's what the client then it is such a better building experience for everybody involved.
Speaker 4:Because the minute you break trust, the rest of the relationship, the rest of the transaction, you're fighting to get it back. It's a losing battle. It's hard to regain that trust. So I think you know that's the part where I see a lot of breakdown. Or at the end, if we do an inspection and maybe there's some things that they're not going to address and that's okay, a lot of the things that come up are subjective. But addressing it, not just kind of brushing it under the rug and oh, we don't, it doesn't matter. It does matter and this is why it's okay. So I think that's where I've seen builders really shine is in the communication throughout the process. If there's an addition, you know an issue, addressing it, not ignoring it, jumping ahead of it and then following up and making sure they understand.
Speaker 1:That's where I see the biggest breaks in communication come down so you've been talking a little bit, you and I, about building out a list of, you know, real estate professionals not just realtors, but real estate professionals, so that you want to and you've mentioned it multiple times in the few minutes we've been on partner with. How would you like to see that go? how would you like the relationship with realtors to go?
Speaker 2:so I've been in construction for a long time, but I'm relatively new to it as an industry. I mean, i started my company in 2016 and so I feel like I'm new to the party and I'm kind of coming in and things are already established. So I like storytelling and so I'll equate it to this. A couple years ago was on a men's softball league at church and I showed up trying to meet more men at our church. It was a big church feel, really disjointed, really disconnected. There were about eight teams worth of men, and so all of the new guys were huddled together and then these teams got selected from previous clicks and friends and what was left were all these new guys who got to be on the same team. So you guys are the bad news there.
Speaker 2:I'd love to say we won the whole season, but I feel a lot like in construction.
Speaker 2:It's the same way is that the people are already defensive because of previous experiences. They've already been hurt that they haven't been communicated with, they haven't been partnered with, and so it's just more of the same. And so, jumping in and trying to be different as a builder or bring something different to the table, sometimes it's romantic in theory and people say, well, i'd love it if you did that, or no, everyone says that no one does it. But but it's just, it's hard. It's hard to break into relationships that haven't previously existed and where people have been lied to and and used and generally just trust yeah.
Speaker 2:So we kind of we approached it from a different angle again, because I'm new to this. So we reverse engineered how to be good at our job. So we asked like, what are the biggest three problems with custom home builders or new home builders or remodellers? and it's like, well, they took longer than they said they would, they didn't communicate and they went way over budget. So if I win at those three things, i'm better than 90% of the competition. So we use construction management software that includes realtors, it includes designers, it includes trades and the homeowners can follow along, get daily job blocks, pictures of where we're at in jobs they get can schedules, they get a dedicated project manager because, again, we're trying to focus on partnership and experience rather than transaction and it comes at a great cost.
Speaker 4:So that's great. That's huge to bring the realtors in on those updates too, because a lot of time I have to go to my client to find out what's going on because the builders not communicating with me too and I think again where, if there's an issue and like oh, i didn't get my fridge on time, well, this is normal we get.
Speaker 1:I've see this everywhere you know, so I think that's that's huge, that's absolutely is it normal in your experience for builders to include you in things like co-construct and these, these software? I think it's a brilliant idea. I think every time. You know, when I built my custom home, it was just us. A realtor wasn't involved on it, but is that something that you see a lot of builders doing?
Speaker 4:no, not at all. I have to pull out updates, i have to call, i have to show up, i have to just go walk it myself and be like I'm here every month.
Speaker 3:You know, i would need to see the progress and and some are, but it's very rare and what you're saying, since we are always transparent and talking real talk this is encouraged with a large majority of home building companies and with their sales teams is get the realtor out of the way, because the realtor messes the whole thing up.
Speaker 3:They get in, they put thoughts in their head, and that is transparent. That is what not all but a large majority encourage and train their salespeople to do is push the realtor down. The buyer is your client. We're not. We have. No, we don't need you in the way. If I'm just being honest, no, no, no, that's a really good point, it's very true, but you disagree because there's always two sides.
Speaker 1:Oh, you know, and you got to look at it. Okay, why? Why have home builders taken that that that you know trend of shoving the realtor out of the process? Right, you know, and you can probably speak better to that than I can, but everything I hear is the realtor didn't take the time to get to know our process. I've never seen the realtor before Here. She came in after the contract was already signed and we didn't see them until it was time for the punch list. You know, those are the typical things. Now, i'm not saying you know, everybody does that, but those are. That's the other side that I hear typically, not to throw you on the hot seat. How do you feel about that?
Speaker 2:I mean, I'll approach it first as a home buyer, right So I said I brought it my experience a few years ago. So our realtor showed up to a home inspection and felt like she needed to defend us to the bill.
Speaker 2:A look at all these things I found And to me they were important. They just weren't huge. I mean, it's what we expected in a production home. So, flagging these issues and, i think, fixing them, we realized it was of great importance. But it was kind of funny to see the dynamic that was created that we didn't ask for And someone was defending almost like our honor or our name or our investment. And really it was some sheetrock punch issues, some doors that have been missed. I'm not saying they weren't big issues, but I don't think they were as big as they were blown up to be.
Speaker 2:So now, as a builder, i think the flip side is is that we pay for home inspections at frame, at sheetrock, at punch And we pay for those and we encourage people to find things wrong with them because we want to turn over a great product. So we take emotion out of it. Someone on my team captures information and feedback without being emotional about it, because it would be easy for me to be emotional. I'm focused so much on our brand and what we're building And I lose sight of the fact that kids will be playing on the floors we installed, that they'll be celebrating Christmas around a tree in the living room we just built, and so when you can take the emotion out of it and not be defensive, i think it leads to a better partnership And the realtors that have been able to establish that.
Speaker 2:There's one about like praising public coach and private right, like we can partner on this publicly, and then, hey, let's have a discussion offline about where there's some big misses and where I think we can be better. There's just a reciprocity there in terms of professionalism. I think it would bode well for relationships especially. You know you brought up that inspection process. I feel like that's where it really goes off the rails.
Speaker 4:It does And it gets heated. And then some clients, especially first-time homebuyers, they don't know what to look for, they don't know what's right, they don't know what's normal. And then the inspector can come in and sometimes they can rile people up and well, they did this wrong And they did this wrong. And so sometimes, as a real Triana builder, we're coming into a bad inspection that really could have been positioned better in a way of understanding and hey, this is just. These are tiny, these are little things, this is normal.
Speaker 1:So yeah, Do you think that a huge part of that could be corrected just by taking the time to get to know the process?
Speaker 4:Yes, yes.
Speaker 1:You know, we talked about that a little bit last time you know, going to the builder's office or their model home or whatnot ahead of time and just saying, hey, just walk me through this a little bit, that way I can understand what goes on. You know everything from how many draws you guys typically take. I mean, you know you can't ask questions like what your build time, because that's the least fun question. Two months, yeah, you know, i mean, honestly, this conversation right here is perfect because if we can start fostering, you know that, open communication, i mean that would solve, i would think, a huge part of it, right, yeah?
Speaker 4:I mean there's builders I love and I will go take my clients to them because I'm like I know this process and they're going to take good care of you and they're going to outline it and they're going to step in here and do these things right. So, and then there are builders where my clients want to see it and I'll go show them and I'll say you know, in my experience this hasn't gone well. But every community is different and every project manager is different, and so let's see how this goes and kind of knowing which builders are friendly or, you know, receptive I think that's more of the word.
Speaker 1:How you fix mistakes is usually more indicative of never making a mistake.
Speaker 4:Absolutely And own it. I want it Yeah.
Speaker 1:You know, i don't care if you're building the same house a thousand times. Something is going to happen on every one of those homes, everyone.
Speaker 4:There's just too many trades. Too many hands There's a million moving parts.
Speaker 3:It's a R&D treatment. He was my mentor treatment homes and it was we. That's how we train sales is is understand and tell the buyer and the realtor every home has over one million moving parts in it. There is no perfect home And it's. And I think, once we again communicate we have the systems, We're doing this. Everyone tends to go Oh, we're, we're in this together, Right, I need you, I need you, I need you, I'm fire closing at the end. Yeah, But it is. That is as an education on the buyers side That comes from the realtor and the builder and the lender, because you know you're absolutely right.
Speaker 1:Everything that you just mentioned, or those are all things that we as lenders have to be really good at, you know, because sometimes clients will tell us things. I mean you feel like Sigmund Freud on the psychologist couch and go tell me about your mother, but but you know we, they'll tell us things. Well, my realtor is annoying me, my builder's not doing this, you know, nobody's showing up All that kind of stuff. They'll tell us stuff that they won't readily tell everybody else And we can go. You know what. This is normal.
Speaker 1:The languages are taking nine months. you know those little things because if we're doing construction loans consistently over and over and, over and over again as a company we've seen everything you know but we also have to do it's. there is a little bit of a balance because, you know again, maintaining that fiduciary responsibility and confidentiality with our buyers, but we also have to make sure hey, tony, you might want to call this guy, you might want to have one of your, your folks, call this person. These are the concerns that they have, you know and same thing. We as lenders are absolutely as much on the hook for this whole thing as as everybody else.
Speaker 3:Well, you're the one that takes the baton through the finish line, so like it really comes to the 11th hour and the funding and it's like and that goes back, you know you can, even on the lending side.
Speaker 3:I remember when we were starting milestone the amount of time, energy and brain power that went into creating and implementing the communication between builder and lender they're a lender at the time and then how that transferred out to construction and sales every Friday. And it was, it was. It was actually cute. It was red, yellow or green. The loan is one of the three. It's never outside of that and if it's not marked, you are not doing your job. Get it together right And then we go back over and you think of, you know, the realtor and the communication and the and the process It all comes to.
Speaker 1:Every team member is now informed And now the buyers we try to over, right, you know, i mean we a lot of. We use technology, yeah, because we can't be all things at all times to everybody, but technology has done a really good job of helping us, you know, give major milestones. We're really a lot of the small things along the way, you know, to the point where, hey, if you don't want to hear it, just tell us, but we're going to proactively communicate as much as we have. That said, you know I'm going to let you guys, uh, throw some hard balls. What? what do you guys see as challenges in working with lenders?
Speaker 4:I have one right now from a production builder, um, and I feel like there's just not enough communication, and This lender even has written an email saying you know, i'm too busy. I'm too busy to take his phone call. I am too busy to explain this again.
Speaker 1:It's a horrible feeling to him.
Speaker 4:15 minutes last week. That's plenty. And I'm looking at the paperwork like I don't understand it and I look at these things all the time And I think right now we have a lot of these really creative incentives that are not so easy to follow, and then Some of it falls as a seller credit, some of it's a buyer credit, some of it's interweave, some of it's a rate buy down that's not reflected anywhere and these numbers get real confusing And if you're a first time home buyer, you have no idea what you're looking at. Yep, and as a realtor, i'm trying to explain this paperwork, but I I don't understand these, this creative finance and this 15 minute window, and then then you shouldn't have to Cricket this.
Speaker 4:Cricket, this Honestly, i've had to explain all of it, this whole thing, and so and it's sad and again writing this lender and being like I really feel like if you could just pick up the phone and maybe address these three questions, you know my client would really appreciate it, we would appreciate it. You know. Feel free to call me, we'll do a three-way. You know like we'll get through this And it's just like I don't have time. I don't have time to deal with you or your client.
Speaker 1:Is it a internal lender? joint venture lender?
Speaker 4:It is an in-house lender And so you know, in that respect He didn't really have to fight for the business of the incentives for itself.
Speaker 1:It's not just I don't want to unfairly pick on production builders and their internal lenders, but You know when you have split financials And you have to pay for it somehow.
Speaker 4:So sometimes the loan officer Is either not as qualified as they could be or they're just overworked, and I think that's a lot of the cases, because I get that feeling he's handling way too many files and you know when I call he has no idea who I am And that's fine. Like I don't care, i love.
Speaker 1:you need to know my client proactive approach and saying, hey, you know, maybe if we just did this, maybe we just had a three-way call. Yeah, you know, because I think some of the other part, you know, part of the problem for us is and I'm sure for everybody here We got a little I don't know if lazy is the right word, but you know, the last couple years We haven't done all of those basic things that got us to be successful in the first place, and that's where we really have to get back to. Every client is precious. Whether there's another 10 or 20 behind it should be irrelevant, but now even more so than it was two years ago, when it was breakneck speed. So, tony, what about you? What do you see as your biggest challenges With working with lenders? Um, i would just echo what Jen said.
Speaker 2:I mean um, right now not getting an answer to your phone call, i'm not getting a return call, a return email? Um, you remember those memes during the the local like freezes locally, and all these tree trimmers were wearing gold chains and they said local tree trimmers, yeah.
Speaker 1:Yeah.
Speaker 2:I think that's a good thing. First of all, in the last three years, we've been riding away but prosperity and everyone's become a builder, like chiropractors, techies, stay home, mom. Everyone is.
Speaker 1:We gotta throw a sign on it. Oh my god, i'm a change gtp, i can totally do this. The amount of applications we see from builders that have been in the industry for six months, 12 months. Yeah, you're, you're absolutely.
Speaker 2:And if you were a lender, you weren't going hungry the last three years. If you were a builder a decent one you weren't going hungry the last three years. If you're a realtor, you weren't going hungry the last three years. And all of a sudden, if things have dried up and it was the cyclical slowdown over the holidays, matched with the rising interest rates and talks of recession But people are having to work harder to make the same transactions, transactions work, says again, as a home buyer, i look at it and I feel like there's some sort of manipulation going on, where people are moving all these things around to trick me into buying the home, and it feels um, deceitful.
Speaker 2:I mean, if I look at it from a home buyer's perspective, as a home builder, i just don't get it. It's so confusing. Most of our clients are like, okay, what am I paying, what's my monthly payment, what's the total loan and what's my out-of-pocket at closing, like they have very basic questions. But it's become really convoluted, really complicated, and then, to boot, people aren't answering the damn phone when there are questions about it. Um, yeah, not all mortgage companies. Plug thrive has been great, but we work with a lot of banks, a lot of You know private lenders and a lot of clients that bring money to the table. Those are always the nicest deals for us because they're clean and we don't have to worry if they go buy a new truck or a boat Or you know.
Speaker 1:You know A point is is that education up front you know that's part of the communication is okay. Here's what a construction loan looks like. That's the challenge And that's why we we do a lot of seminars which, by the way, we're overdue for a seminar But most people Have never built a custom home before they built production. They built move up, move up, move up, resale, whatever the case. They've never gone through that process, you know. And, and the same goes, make sure your marriage is on a firm ground when you build a Custom home.
Speaker 3:I think it's a even worse out.
Speaker 1:And um process. It's a massive financial investment. And then you got a. Then you have to go, wait a minute, i have to start paying before the house even starts, or I have to do a construction loan. And it's really not that intubate or scary once you can clearly articulate it, but I think that's what we need to do better as an industry is go, okay, here's the anatomy of a construction loan. Here's what it looks like from our perspective. Here's what you're going to see from the builder. And you know we just have to get better at it, you know.
Speaker 2:I think about a home buying process. When I went to a showroom I got to pick my flooring, my cabinet, the paint color, and that was it. That's the process that was explained to me Will be done in september and I'll like this is awesome. You're still excited. I don't remember. It was probably spring, like january, february when you're looking, um. But but there was excitement and, as a new home buyer, we just desperately needed into a home We'd been renting because we'd moved to austin and not really found a place. Everything was going quickly then And and so we were just excited to find something that didn't have 100 offers on it, right, and so we, we bought it. We were excited about cabinet colors and no one walked us through the process. I remember moving in and realizing, did did they not give us a garage store opener? And I like, yeah, we don't do that on any of our houses.
Speaker 3:I just like what.
Speaker 2:I like what the hell? so again, the caveat or the benefit for us as a homebuilder is that now we get to approach it Entirely from the process and what the expectations are. So I tell clients up front you were a lot. It's like a roller coaster home building and remodels and and we're gonna start demo or or lot, cut in And you're gonna love us. You're gonna be like, oh my god, they're gonna be done in three weeks because it's moving so fast. And then once frames done and you got a rough electrical, rough plumbing or you're in remodel stage and demos done, waiting on permits in the city of Austin, we hit the screeching halt. And if we haven't managed those expectations well, they lose trust. What the hell is happening at my house? no one was there, nothing's changed. Every day there's a new water bottle, but that's it. Like nothing has gone on. And so managing expectations and what's happening behind the scenes, what are timeline looks like, is so critical to our success again with relationship and expectations and then, ultimately, outcome.
Speaker 1:So Hey, so you're building a house for Andrew Smith, one of our regional leader, and you know it was. He echoed a lot of what you're talking about. I mean, it's the. There's a lot of anticipation, anticipation, anticipation, and then that turns into this flurry of activity. You know forms, that foundation framing. He said you guys put the framing up in There to wow, i mean.
Speaker 2:Hey, it was well stick framing, we didn't do blocking, she, things like that but yeah, i mean material take offs were really tight on this house.
Speaker 2:Multiple people on our team precheck them, not not to go off course, but one of the things we talked about during, you know, these rate increases was how are builders responding to Price changes, materials, and so what we've done, at Brian's urging, is when we get soft cost draw, we buy all the materials. We make zero money at soft cost, and so i'd never, throughout coven, had to go back and say your window package change, i'm gonna need another hundred grand. And so i'm shocked to see so many builders. We have friends with the other builders and i like, yeah, we got closing. It was 180 thousand more than we Have.
Speaker 1:Yeah, most don't cover the ones that do. I mean you have some some pretty strong financial wherewithal, course, but to be able to buy packages and stuff like that up front is huge to you know. That way you're in front of the game and set it behind it. so, yeah, the cost overruns and highly damaging over the last couple years. You know, because imagine we're doing a hundred percent construction loan for a veteran, you're down, you know, a lot of times they may not have a ton of reserves. So what happens if there's, excuse me, a five percent or six percent or seven percent cost increase? that is catastrophic really for everybody. You know the builder, because you guys really are getting your profit on the back end. We don't get anything till we close on the permanent loan. Excuse me, but the buyer now they don't have a house right, because they can't afford that five or six or seven percent increase. So Yeah, that's been a, it's been a little bit of a point of contention over the last years and it's getting better.
Speaker 1:Oh, i think yeah much better but you know, and there was some bad behavior going on with a lot of builders and whatnot, but I love that you guys have done. You know, i'll kind of go back to what you've said multiple times in this conversation. You've kind of reverse engineered it, you know. So you're looking at it from a client's perspective and I think that's really good for me to hear, because sometimes I don't do that. Ok, wait a minute. I'm looking at it from my builder partners and my realtor partners perspective. I need to start focusing back on the client side. So great way to do it.
Speaker 2:We're students of the game, not experts. I wish we could get it all right. I mean we don't, but we're just constantly learning and listening and asking. I mean, we have someone on our staff who's paid to full time gather information and feelings from people. We call her the love bug. That's not on her business, ok, love bug. So, without, without emotion, she reaches out at milestones and says how are we doing? How are you being communicated with? where we drop in the ball, where would you love, what do you hate? What can we do different? And she doesn't have to come up with a solution ever. All she has to do is gather feedback and then she hands it off to someone on our team who is most influential in fixing the problem or in giving the praise Right, because there's a lot of praise too. But we're just, we're constantly being students of how, how can we can improve, how can we do that?
Speaker 4:So, yeah, And we're trying to start doing it as a lender, you know.
Speaker 1:And then part of that is because a lot of times what in our industry is again on the back end Wait till the wait till the closing table, what not? So, and we're learning that lesson as well, you know, and checking in along the process, not just the client, but also checking with her Hey, how is our draw process? What was the communication with our team and all that kind of stuff. So I know we're running low on time, but I would love to hear what are the top three things you wish all builders would know? Good question, yeah, three things.
Speaker 2:Goodness Holders or realtors, because I need to know. Thank you Well, you, good, good Thanks for that.
Speaker 1:That's very good.
Speaker 4:OK, i would say pull the realtor in. We are on your side, or most are I. You know, some realtors love to stir the pot, just to stir the pot. So when you saw that story Yes, i've seen those realtors. But I think a lot of times builders look at realtors as the enemy and they're going to come in and they're going to create this issue and they're going to make my job harder. And it's like if you only knew how much we're really good, agents are trying to help and try, and there's a lot of like things. I'm saying that's normal, that's normal, it's OK. So I wish more builders looked at realtors as partners And again, i'm sure it goes both ways One, so that would be one. I think, especially with first time home buyers, i wish more builders held their hand or explain the process And again, we've touched on this a lot But those are my hardest clients because they are so scared and it is so new and it is so foreign And maybe you're doing this transaction and it's not your language that you're doing it.
Speaker 1:The only thing they know is what they've heard from the media.
Speaker 4:Like nobody teaches them how to buy a home. And I had this conversation with my client yesterday and he's like I just didn't even know what I didn't know And I'm like I know.
Speaker 3:I understand what a three, two, one buy down is, and I mean, like you're right, it's causing costs I don't know what this is, and I didn't know, and I didn't know my debt to income ratio.
Speaker 4:And I didn't know that, you know the anti-tip on the oven is never attached And so like there's all these little things that you just don't know until you do know. So I feel like I wish there was a better education process for first time homebuyers, specifically, because it's just, it's a lot, it can be overwhelming. And third thing I wish builders knew. Well, come back to me on that, i need another.
Speaker 1:Well, you're first too, okay. Okay, give me a pass. Same question, except what do you wish? all real.
Speaker 2:I want to start out by saying like there's been a lot of negative but there's so much positive, and I think the negative comes from the few realtors that have done an exceptional job. Have become the rule stick that we measure the free realtors against, unfortunately, and so a lot of them stick out And, i think, probably dictate this conversation, because there are more of those than the exceptional ones, but there are so many exceptional ones that make our lives great And what we do really great, so shout out to all of them because they're amazing.
Speaker 3:Love the positivity.
Speaker 2:I will say that advocate for us. I think that partnership is a two way street, and so I would say that I have four kids and it takes a lot more than just my wife and I. It takes our pastors. It takes friends from church, people in the community to keep eyes on them to make sure they've got a helmet on when they're riding bikes, to make sure they don't walk alone after dark. It just fill in the blank right. It takes a village, and so I think in the home building and home buying process, i think it takes a village, and so I think if people advocated for us more, praised in public, coach and private, that I think it would be really productive.
Speaker 2:Communication Vernacular huge. I love that you mentioned that, because no matter what the industry is, if you're in full time ministry, if you work in a restaurant, if you work at a bar, you're gonna use everyday language that no one else gets, and so if you're talking about rates or construction or loans or mortgage, people are gonna get lost, and so I think simplifying it and I'm a very simple person, simple minded at least, and so I like simple communication because if you have a point I need to get it, so that we're both on the same page. So the last one I would be, i would say is I don't know, i feel stumped, kind of like Jen.
Speaker 1:Okay, so then I'm gonna give you guys both an hour. So and this is for all of you give us a couple of things that you wish lenders would either do or they should know about this whole process.
Speaker 4:I wish lenders would check in more regularly. Communication And to the phone Yeah, maybe have supporting materials to help explain what the lending process looks like, cause some people can hear it and understand and some people need to see it and understand and some people need to read it. Everybody has a different communication style And I think a lot of times a lender can just be head down this is how I communicate, this is my process. When maybe the client's not understanding And I know it takes a little bit more work and a little bit more to see, okay, here's a video I put together that you can watch 10 times And maybe that helps it sink in. Or here's a flyer I put together that guides you through the process And that way you know where we are. Or I'm gonna just pick up the phone each week and I'm gonna call you. But I think multiple communication styles would be really helpful on the lending side, because it's just confusing and it doesn't always sink in until it does.
Speaker 1:And so when you're talking about that education piece and informative piece, it sounds like what you're talking about is not just hey, here's all the products, 30 are fixed 3% down. Here's what mortgage insurance is. Correct me if I'm wrong, but it sounds like you're also talking about the process itself outline and maybe a vigilade or a video on. Here's the main steps. Yeah, what a prequel. Looks like a lot purchase construction loan.
Speaker 4:All that kind of guiding them through is that fair, Exactly exactly, And making sure it's sinking in And making sure it's not a lot of conversation Like, oh well, maybe I'll send you a video, Or I don't know. It can be a fluid process sometimes to make sure that a client is on the same page.
Speaker 1:No, i love that. I customize it. Questions will still come up, but they go. Oh, i remember you talked about that already. So yeah, that's really good.
Speaker 4:And there was one lender I recently worked with and I love. Every week they sent a video and like I could go watch these videos. It's like the easiest way to take a video And the best thing about video is you think someone. You don't remember whether someone picked up the phone and called you or if they showed you a video.
Speaker 4:Like you feel like that person reached out to you And it was special. Yeah, it's like things, too, what I was thinking about, And I think it's huge. And again, I have clients who want to watch that video 20 times.
Speaker 2:And that's a unique sticking point. It's always the same stuff, and so you can pick the milestones ahead of time and know exactly where people are gonna get on.
Speaker 1:What Anybody else?
Speaker 2:It's not just for lenders. I think it's for me, probably for Jen, i think it's for all of us is that there's a universal truth that you will harvest what you plant. And I think that we're walking into a season where work has been chasing us down and we couldn't beat it away with a stick, and I think now we're back to this level playing field where you really have to work for your keep. You do, and not just for the transaction, but for the relationship and the partnership. I prefer it.
Speaker 4:Yeah, it's an opportunity to go back to what we used to do when we were building our businesses and really had to get out there and understand what our clients were facing I think you mentioned it earlier Like we were just chasing our tails. It was so fast It was hard to keep up. Customer service just plummeted as a result of that. So this is our opportunity to do better.
Speaker 1:I have to realize that, okay, we've got to get off our bus. That's one of the biggest challenges I have is working with my loan officers is it's not easy. It's not easy to drive a community When you're not getting paid for it. It's not easy to pick up the phone on a Friday and say, hey, just wanna let you know I'm accessible over the weekend. But those are all of the things that we need to be doing Again. That ideally or more than likely. How does this be successful in the first?
Speaker 3:place And to your point. When we were hosting the training for the LOS, one of the things Brian's said was even if you show up on a Sunday after church with your kids, or on a Saturday in yoga pants, with your hair in a bun, then I see you as more human and I can connect with you. It's simple. It doesn't have to be difficult, just stop by. Hey, how's it going? It's five minutes right And it's human connections Yeah.
Speaker 1:They're gonna go. Wait a minute. You're a lender and you're here on a Sunday afternoon. Wait a minute. My banker doesn't work these hours. I mean, and it's not like you have to sit there And, like you said, you don't have to dress to impress. I mean, sometimes you can if you're coming on. Whatever the case is, you don't have to have a script, you don't have to sell, just show up, just show that you're working when you're part of it And it doesn't feel like a gimmick because there's so many gimmicks out there Like if you're free to offer buy a house or borrow a blockbuster DVD or whatever.
Speaker 2:Whatever it is You're on fees, I don't need a gimmick. I already like if I want a house, I'm already gonna get a house. Just a relationship and knowledge and communication, Like that. I don't think we need gimmicks anymore. The gimmick is connect. The gimmick is answer your phone. The gimmick is honor your word. So I like that Yeah.
Speaker 1:Well, thank you Really. Really great conversation. I knew it would be, And bringing the two of you guys together to really talk Again, honestly can't thank you enough. Hopefully we'll continue this conversation in future podcasts, But thank you so much for the time and bringing our insights And joining us.
Speaker 2:Thanks for carrying it. Yeah, that was great.
Speaker 4:Carrying it.
Speaker 1:Well, we'll give a shameless plug. Tony Villareal, with Alabaster Custom Homes, build 512 for all of our local people. Jen, saladay, cooper, sotheby's, natalie. any closing remarks?
Speaker 3:Just be a good human, get out there, connect, take it back to the basics Builders, lenders, realtors Because when we get back to the basics it makes sense. And that's communication, connection, transparency, so easy.
Speaker 1:Nothing else needs to be said. Thank you, drops mic.
Speaker 4:Hi everybody That was a good guy, good boy Wait 85 seconds Good job.