I am an avid CNBC watcher but not as much as I used to be. They have gone from reporting hard news to advocating for their own positions and favorite companies. If you only evaluated companies based on their stock performance or the comments of a CNBC on air personality, would you end up with the best product?
Never judge a builder by its stock performance
If that company is a home builder would their stock performance guarantee you the best home?
Is a large publicly-traded company better than a local builder?
That depends. If you are buying a new home from a production builder, bigger might be better in some cases. Sometimes I find that the public accountability is a plus. Maintaining a good reputation can be very important to a company in business for the long haul. Good press, positive online reviews and satisfied customers can contribute to happy shareholders as well as happy homeowners.
Floor Plans
Large national builders do have their fingers on the pulse of whats popular. The were the first to have open floor plans but even smaller local builders are catching on to the new layouts.
Bigger builders often have access to a larger pool of subcontractors and project managers which make it easier to maintain a consistent schedule and deliver homes as promised. For smaller production builders there is often tough competition for the good subcontractors on a local level. The best subs want to work for the most successful builders with the best reputations.
Production Builders vs. Custom Home Builders
The biggest misunderstanding today is the difference between production builders and custom builders. Most of the new home communities where you can purchase a lot/home package are being built by production builders. When you look at the companies included in the stock market indexes Lennar, NVR, Toll Brothers, Pulte and others all are production home builders. The offer a variety of floor plans with options and upgrades; if it is on the plan its available. However, if you want a wall moved or a change made that is not on the plans as they exist, the answer is generally no, we cant do that.
This model of production builder has even been adopted by smaller local and regional builders. They may have more flexibility and be willing to customize their floor plans to suit your specific wants or needs.
Custom home builders often start with standard floor plans but they will make and recommend changes to design the exact home for you. Selections of everything from appliances to flooring and kitchen countertops are almost endless. If you want a particular range or a full size wine cooler in your kitchen, they will design the rest of the kitchen around those choices. Never judge a builder by its stock performance
So many choices
Regardless of price, there are good builders in each category. In short, I want any builder I recommend to my clients to be honest, focused on customer service after the sale, responsive and respectful. They need to be successful enough to compete, attract good subcontractors, treat their staff and partners well. Integrity starts at the top of any company and filters down to the folks who actually build and deliver the home.
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