Smart home builders know they need an early start to 2023 as mortgage rate increases cool and construction costs settle to more consistent levels. The key for builders is to not panic but rather hunker down in the near term and maximize the opportunity for work that is now available.
Experts say home buyers will return to a tenacious housing market soon, because a fundamental shortage still persists. In fact, one estimate pegs the shortage at 1.5 million units. As mortgage rates dip below 7%, analysts predict more homeowners are likely to opt for new builds.
This is good news considering home builders reported low confidence throughout 2022. Experts predict the overall housing market will weather the current downturn and builders will see volumes increase through 2023.
In the meantime, however, builders need to maximize the limited opportunities that come their way by finding ways to bid quicker and more accurately.
This means offering the most competitive bid without blowing project budgets or having to request change orders. But how does a builder get there ?
It could mean increasing asking price, reducing costs, or simply knowing when to pass on a job. The correct choice, however, first requires knowledgeable foresight. A builder must be running their business as efficiently as possible and have full insight into their profit margin.
To gain these data insights, modern home builders and remodelers rely on estimating and management software. In the past, smaller builders couldn’t take advantage of such software without spending large amounts of money, when the goal was to expand profit margins.
Today, however, small builders can take advantage of the latest technology and full-service software without increasing overhead. Today’s software offers affordable options that don’t lock builders into expensive, long-term contracts.
Because data is stored in the cloud, builders can also access their takeoffs, material costings and project schedules from anywhere that has an internet connection. With the freedom to estimate, quote and manage their projects from anywhere, building software eliminates the need for builders to spend hours of their week in the office, away from the job site.
Builders find the tech investment worth it because, in time, construction management software becomes a reliable platform for performing:
- Fast, accurate estimates that allow the builder to bid more without fear of underbidding;
- Online collaboration with subcontractors and material dealers;
- Critical project scheduling to ensure materials and subcontractors are on site when needed;
- Powerful cost tracking that improves future bidding by comparing actual costs to original estimates;
- Clear, detailed invoicing that simultaneously improves cash flow and customer service.
Consider Ron Marcella III of Marcella Building and Renovation in Pittsfield, Massachusetts as a real-life example of how the right building software keeps you profitable even in rocky times. Marcella has worked in home construction for 30 years. He started using cloud-based construction management software, Buildxact, to speed estimating to win more jobs.
“If you’re able to provide a quick and accurate estimate for someone right in their driveway, it’s huge,” Marcella said. “I really wanted to narrow down the estimating process to a small-time window so that the customer can decide if it’s out of their price range or if they want to move forward and put a deposit down.”
In the end, he says software has made him a better business owner.
“What’s exciting is that I’ll be able to take my focus from double-checking that my numbers are right and (instead) focus on the numbers my business is doing.”
To learn more about how builders can use cloud-based software to create more accurate estimates in less time, visit Buildxact.