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The Total Cost of Doing Things

Nuke | Posted in General Discussion on December 19, 2009 08:10am

When I bought my tract home in 2000, I got to watch ~90 more tract homes in my community go up. Additionally, I got to watch quite a few other new planned communities (ahem, subdivisions) by tract builders and work up a confident feeling on how long it took each trade to do its thing. Some observations made include the concrete folks erecting forms for walk-out basements that would tear down those forms in less than 24-hours. No regulatory body to control this behavior that was observed across multiple counties and hundreds of new tract communities. Footings, on the other hand, had a week to cure. A typical two-story 2000-3000 square-foot home on basement took approximately 3.5 weeks to stick frame. This framing included all plates and headers, studs and joists, decking and sheathing, and in some rare cases trusses. Sheathing typically focused around 20% OSB, 70% foam board, and 10% mystery. Insulation of these kinds of homes took about 2-3 days. Almost all of them were done with batts in the walls and enclosed joist spaces, and their attics having blown insulation. Lowest form of insulation was common. Up until about 2005 most tract homes I observed were not being wrapped in anything, and even after 2005 usually only those tract homes selling well above the starter homes were wrapped. Most tract homes not selling well above the starter home had two CATV and three POTS locations in the home. Even in five bedroom five bath homes. The use of MDF components for finished carpentry in ‘wet’ areas was not uncommon. Any exterior carpentry that wasn’t man made (e.g. wood) was never primed and suffered early rot when contractor grade paint was applied. Typically two years would pass, the paint completely worn, and rot had set in. Any tile work that had grout was never sealed, seldom levels, and go forbid if the skewed lines could be straightened with beer. Maybe this is tiler art? For tiling back-splashes it was easier to not bother with a tile saw and just create tiny tile pieces to make up the area in coverage. Pre-wired security systems were commonly not protected against post-installation damage. It was more for look during the exposed wall time period than for real post-sale use. Use of modern joist systems are for faster installation of said joists and not for design uses such as quiet floor systems, for hiding mechanicals, etc. and on occasion you could find an I-joist or two that had been compromised even though the COO had been issued. With all or most of these examples of observations I have to wonder why the tract builders just didn’t sell double and triple wide mobile homes and speed up the process. In comparison, I have to say that I have lived in properties that were approaching, if not already in, dilapidation but were +80 years old. And yet, those old homes had a lot more going for them than that offered in the new contraction tract home market. And while I understand that most folks didn’t have $40-100K sitting around in a savings account to master that normal 80% LTV honest mortgage, even fewer had the ability to go custom in order to skirt the tract madness. Ok, enough soft-ranting.

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  1. User avater
    popawheelie | Dec 19, 2009 11:37am | #1

    I think in the US we are still following a model like Henry Ford.

    We were taught in primary school the Henry Ford was a kind of hero for what he did by making cars affordable for "everyone".

    We are doing the same thing with houses.

    When we lived in Kansas there was a move to eliminate sidewalks ( they were required) for new subdevisions so new homes could be more affordable. I was amazed that a realtor we knew, and had bought a house through, supported that.

    It does make sense though if you believe that houses are just places to rest before you drive out to your job. If you have one.

  2. roger g | Dec 19, 2009 11:55am | #2

    Back in the very early 60's(just before I was a teenager) I remember some subdivisions being built in our smalish town. Even then I was very interested in construction and I remember the talk of the town back then was how poorly those houses were being built as compared to way "they used to be built". Trashing the construction of these houses was common talk around the town.

    Fast forward almost 40 years later I was back in the town and was listening to a real estate agent promoting resale houses in the same area. He was saying that back then they really knew how to build when they built those houses.

    Up here for many, many years they strip concrete forms off in about 24 hrs but have to wait a few days before they can build on them.

    roger

  3. User avater
    Matt | Dec 20, 2009 03:25pm | #3

    Nuke:

    I think I see what you are getting at, but hardly in your post did you mention the economics of the situation.

    The thing is that all this is $$ driven. These track home builders are masters of cheap square footage because time and time again they have found that is what sells easiest, quickest, most often, etc.

    Home buyers say they want quality but 80 to 90% somehow feel they should get quality at any price, and when confronted with the reality of paying that $200, $300 or $400 a sq ft (excluding land) for real quality they just chicken out.

    These tract builders are simply delivering what their market demands - square footage at the least possible price. Eighty to 90% of the homebuyers simply don't know the difference. The heck with counter flashing. Slap up some crown molding and granite counter tops and it will sell - since that is what people want. In their mind, that is quality. They just don't care what counter flashing is and feel why should they pay for something they can't see when sitting in front of their big screen....

    OK - sure there are some builders and buyers who operate in an environment where quality is king - but that market isn't the subject of your tract home discussion.

    Your observations are of an industry looking in from the outside. I'm offering a glimpse of the view from the inside looking out.

    The good news is that as newer codes and regulations become mandatory, reasonable quality isn't as hard to find, realizing of course that these things also raise the price of the product. Here, for example, all new homes are code required to have low-E windows and some kind of sheathing paper - although many of these tract builders still didn't get the memo about the paper thing...

    So, I hear you saying that the average home buyer can't afford quality? Bull!!! - it is just that they won't settle for a well built 1100 sq ft home - which BTW are rarely built because they wouldn't sell. OK - maybe these people need to buy a good quality condo.... That's what they do in many European countries... But no... here they have to have the 3000 sq ft, the 12 rooms and the 2 car garage....

    Once people in the US are willing to make the life style shift the building industry will change too. We of the building industry can only build what our buyers will buy.

    So - go find yourself a piece of land (there is plenty of good deals around these days) and have that 12 or 1400 sq ft quality house built... Hope you won't be planning on selling it in your lifetime though. Or maybe you will just be on the leading edge.... It's your money - go ahead and take the chance. Oh - and BTW - good luck selling it to the DW. :-)

    1. Clewless1 | Dec 22, 2009 08:06am | #5

      I totally agree. I'm planning
      I totally agree. I'm planning on building a new home for just my wife and I. 1,200 SF tops. Small but decent quality. Nothing really over the top, but still very nice.

      People have no idea of value when building their house (in general). The statement in a recent issue of FHB hit the nail on the head. A good architect (which MAY be hard to find) can design to small limits and in my opinion would pay for his fee in having a smaller, smarter designed house. People will design their own house to save the fee ... but that often results in way over design that easily consumes 2-3 x the fee they would have paid.

      But like you say, their perception of quality is all they think about. It's a wide spread attitude and mind set that quality is about quantity and granite counters.

      Can you believe the average (AVERAGE) house in Boulder, CO is in excess of 5,000 SF!!! Wow! They must have really big families down there!

      My theory ... my 2 bedroom house will be marketable as energy costs get insane ... people will appreciate the efficiency of small combined with good quality of construction.

  4. User avater
    Matt | Dec 20, 2009 04:16pm | #4

    Nuke: PS:

    Reading between the lines of your thread title "The total cost of doing things" you make a really good point, but for what reason I don't know, most people just do seem to look at as the total cost of home ownership. To add to that I think most people just don't maintain their homes properly. I mean even if a house is well built, the caulk in the tile shower is gonna have to be redone every 5 years or so, and the exterior is going to need a check and possible recaulk and possible paint every 5 to 7 years. Recently when looking at used houses that just wasn't what I was seeing. We ended up buying what I think is a well built but not well maintained home. Being that it was only about 4.5 years old, and done right to start with, it hadn't gone down hill too much. I spent the first 2 months repairing and re-doing little stuff. I think maybe many people look at homes like cars where you just keep them clean and just get a new one every 5 years or so... Ok - maybe you slap on some tires, and if forced put some breaks on.

  5. maverick | Dec 22, 2009 09:01am | #6

    you dont always get what you pay for. its called buyer beware.

    anything that is labeled "builder grade" is usually just a cheap alternative.

    it amazes me that people will spend months researching a new appliance or a new car, or any other major purchase, but go into a home purchase blind.

    I am a building contractor and I tell all of my close friends and family if they are going to make a home purchase let me go look at the place first. even if they pay for a bank required "home inspection". I cannot emphasize enough how worthless I find the majority of those are.

    I suggest others do the same. bring someone along with them who knows the ins and outs of building construction.

    what appears to be a small problem now will fester. when I was in the roofing business we used to say the worst leaks are the ones you dont see

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