Small Builder, Big Advantage. Part 1: Identifying the Market

It’s no secret that the new-home market is crowded and competitive, especially when it comes to a homebuyer population impacted by the drastically changing conditions—and rapidly shifting priorities—of a global pandemic. And sure, with so much demand, it might seem like a good idea for a builder to churn out the same homes they’ve been building for the past 15 years. However: What may have been a homerun in a past era is now a concept that doesn’t always meet the evolving needs of the modern home buyer. In other words, one size doesn’t really fit all any longer. When it comes to building a home, it’s about understanding what the local market needs to fulfill lifestyle, business, and family goals, and diversifying your design accordingly.

That’s where boutique local builders have a leg up on other firms that may not have the time or incentive to do a thorough analysis of an area’s particular dynamics. These might range from a workforce with increasing work-from-home status, to a mobile entry-level population or an empty-nest cohort in search of a forever home. Put another way, knowing your audience helps you customize your product. “By using design as a marketing tool, it can give you an advantage over the competition,” says John Guilliams, partner and director of design at KGA. “Smaller builders have more flexibility and can make quicker decisions because they’re not answering to a room full of shareholders. Being a local, small builder, gives you a unique understanding of your buyers, and you can cater your home designs and amenities accordingly.”

Case in point: KGA recently partnered with Stylecraft, a regional central Texas homebuilder, in successfully targeting a completely new market. Stylecraft typically specializes in entry-level housing product. However, based on an assessment of environmental and demographic factors, it was looking to diversify and develop housing that caters to the 55+ market. The biggest issue was narrow lots, so Stylecraft approached KGA with this new market premise, understanding our expertise in the area given the pervasiveness of narrow lots in Denver.

Together, we were able to tailor the home designs to the target buyer by carefully identifying the most desirable features for this particular market. These buyers aren’t purchasing their first homes, but rather, seeking what will likely be their forever homes. That means a design that will age with them, from doors of a certain width to accommodate future mobility aids to carefully chosen finishes that maximize surface contrasts and minimal stairs for safety reasons. As a smaller builder, Stylecraft was able to take stock of the area, determine a niche that needed filling, and seek KGA’s expertise in designing within the constraints. Not every builder has the desire or the ability to pursue that level of detail.

Understanding the local market and diversifying your offerings to work for that market is becoming increasingly important for builders as the desire for age-targeted communities—and the subtleties that go with them—is growing. Take Sonders, a 55+ targeted community in Fort Collins, Colorado, currently in the final stages of planning. Here, the Sonders team saw an opportunity to target its housing and accompanying neighborhood features specifically to the type of homebuyer typical of this area. The fast-growing region is anchored by Colorado State University (CSU), which means the population is packed with professors, researchers, and educators in need of housing.  “This is a good example of thinking strategically about amenities,” Guilliams says. “In Fort Collins, you’ve got an influx from CSU, so you know there’s probably a desire to continue to learn and grow. Maybe you don’t want a typical community pool, and instead, you put in a learning campus with several small buildings with specific programing goals for craft studios, fitness, digital learning, etc.” At Sonders, in addition to the pool and outdoor center, a learning center will host workshops, presentations, and classes on a variety of topics—an outside-the-box amenity specifically geared toward the region’s 55+ market. “It’s about not coming into the community with a predetermined formula.”

We worked with Epic Homes, a boutique builder in Colorado, to design floor plans with incredible flexibility and numerous options for customization. Epic’s goal is to reinvent the formula for homebuying by offering a more personalized, enjoyable experience to buyers. Pictured: the Pinnacle model by Epic Homes at Anthem in Broomfield, CO.

Deciding when and how to reinvent those formulas is a luxury small builders have after they’ve identified and understand the market. Is the population comprised of families with an interest in school district quality? Is it young professionals with little need for backyards and two-car garages? Is it active senior citizens who want accessible trails and continued education opportunities? Ultimately, boutique builders are well positioned to use their regional expertise in identifying these markets and harnessing their local understanding, community investment, and responsiveness. In other words, they are uniquely suited to recognize hyperlocal trends, form the most beneficial partnerships, and meet evolving buyer needs with distinctive site planning and home design.

For more on providing market differential through regionalism and innovation, and on executing a quality lifestyle for the right area, stay tuned for Part 2 and Part 3 of our Small Builder, Big Advantage series.

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