The Atlanta Home Builders Association’s Fifty Plus Housing Council presented dynamic sales and marketing duos tonight at a lively meeting held at Maggianos Perimeter. Moderated by Anthony Perry, the group addressed the age old question, “If we build Atlanta real estate for active adults, will they come?” Builders and their marketing representatives answered a round of Q&A on what they are doing to be successful in today’s market.
Meet the panelists:
Carrie Roeger and Steve Romeyn with Windsong Properties
Jim B. Chapman and Kelly Dempsey with Jim Chapman Communities
Dan Lussier and Mike Kinsey with Soleil Laurel Canyon
Enjoy the Q&A from the event. It is a bit of a long read, but I did my best to capture it all. Enjoy and please comment!
Q: How are you doing with social media?
A: Carrie – We are using an integrated approach of Constant Contact email, blogging and Facebook. It is all Integrated
A: Kelly – We are still focusing a lot of efforts on public relations. Human interest stories work well for us, and our buyers still read the AJC.
Q: How are you doing more with less?
A: Carrie – We are embracing our happy homeowners as brand advocates.
A: Mike – We have an ambassador team and the Internet. We like to use Google Analytics to find out where people are coming from and what they do on our site.
A: Jim – We do more for less with Stonecrest Homes’ blog.
A: Dan – Communicate with homeowners as they can be some of your best allies. With this group of buyers it is important to communicate whether the news is good or bad.
Q: What product changes have you made to address market conditions?
A: Steve – As we have gotten into 2011, we are still looking for ways to increase perceived value and decrease cost.
A: Dan – We went from 13 models to six. Our floorplans are more open and now we offer more base level plans that allow them to upgrade.
A: Kelly – Our secret (shhhh) is that we only build two different houses, the Westminster and the Oxford. Now we offer each of these plans with a large variety of options from grilling decks to supers masters. We have modified our existing product to meet existing customers needs.
Q: What percentage of sales are contingent sales?
A: Dan – 42% last year, 33% so far this year. Typically 95% of them close within six months.
A: Kelly – 60% of our sales are contingencies, but the bulk of them close.
A: Steve – 50% of our sales are contingent. Lots of old guys like me are out there who can’t wrap their heads around the fact that they have to take less for their existing home. I wish I could counsel them directly, but Kris (my sales agent) tries to keep me away from them.
The tenacity of The Orchards Group was also noted as they recently closed a contingency after 18 months. (Maybe patience IS a virtue!)
Q: What organization and staffing changes have you made?
A: Dan – We cut our staff in half and are outsourcing more.
A: Jim – At Stonecrest we outsource marketing, sales and accounting. We have a small core staff.
A: Steve – We pride ourselves on being lean. A number of important positions are part time including accounting and marketing. This works well for the staff members and for us. Additionally, we use BuildTopia for our construction management system.
Q: How are financial partners holding up to meet your needs?
A: Steve – We recently had two banks competing with each other to loan us money! One of them couldn’t compete because they could not complete the deal.
A: Jim – Jim Chapman Communities has been fortunate that we developed and had A&D loans on our properties. Most of the banks understood and pulled back on construction lending, but did not pull the lending.
A: Dan- All of our deals are cash deals. We have disbanded all big banks. We are actively involved with community banks such as State Bank.
Q: Are your buyers using reverse mortgages?
A: Dan – Our buyers are cash buyers.
A: Kelly – Our buyers are ready to pay cash for a house until they meet with their financial adviser. More and more buyers want to get the loan because of low interest payments.
Q: What will the industry look like after the recovery?
A: Steve – Who knows! We don’t know what is going to happen tomorrow. We are the survivors.
A: Dan – I think that the market is going to come back. Atlanta and the Southeast is still one of the most affordable places to buy. We have all been humbled, some of us have been crumbled.
Q: How important is green building to your customer?
A: Steve – We have an EarthCraft project at Somerset and it feels like that green helps confirm with buyers that we are a quality builder. The customer is not willing to pay for it, but they expect it. We’d like to move toward offering consumers a cost of operating the house much like appliances do.
At this point, the moderator allowed questions from the audience and Mims Mobley with Velux jumped in with this.
Q: We often hear that this customer wants what they want and is willing to pay for it. Do you find this to be true?
A: Dan – We see $40,000 to $50,000 in upgrades. In today’s world you give away the basement, but they are willing to pay to finish it.
A: Kelly – Our average upgrade is $78,000. They are willing to pay for it to a degree including paying extra for insulation and other energy efficiencies.
A: Steve – Our byers are buying as much base house as they can and not doing much else. Our typical upgrade is around $19,000.
Tony makes a parallel – Soleil is like a cruise ship, Jim Chapman Communities is a boutique and Windsong is just a good value.
Mitch Block with The Orchards Group fields the next question.
Q: What percentage of your buyers are from Atlanta versus out-of-state?
A: Mike – 50% of Soleil buyers live within a 50 mile radius, 25% are from Florida and 25% are from the Northeast or Midwest.
A: Kelly – 1/3 are local, 1/3 are from Georgia and 1/3 are moving to be closer to kids.
A: Steve – 75% of buyers are from out-of-state and moving to be closer to the Grandkids.
Q: What reservations do your buyers have?
A: Kelly – Will I fit in? Will I like it? Will they accept me? We typically sell the lifestyle. After they have settled in, they say their favorite thing is all of their new friends.
A: Steve – The term active adult does not do it for me. The industry as a whole needs to find a new way to address this audience of boomers.
Q: What is your best idea for next year?
A: Kelly – Educate the sales team not to let the market plague them. Keep a positive attitude, focus and keep the communities viable.
A: Mike – Need to have a lower entry point into the market.
A: Dan – Customer service and doing everything you say you are going to do including the HOA. They got afraid and don’t trust developers.
A: Jim – Being Jim Chapman, being THE builder/developer and showing up. I’m the only one here with my name on the door (laughter from the audience).
A: Carrie – Marketing to create the market. Shift the focus and educate. It IS what it IS – it is the time to make decisions and move on.
A: Steve – My difference comes with age. Jim named his company after himself and I asked my wife to give the company a name. We created pen pals among our residents and prospective homeowners. We have a sign on the way out of our communities that reads, “If you are happy and you know it, tell a friend.”
For more fun and education from the 50+ Housing Council, make sure to attend 50+ University in October.
Article reprinted with permission from Carol Flammer at the Atlanta Real Estate Forum
