Builders turn to free upgrades to make the sale. While many experts predict that the housing downturn will see a reversal soon, it doesn’t change the fact that builders have lots of unsold homes. And selling those units is proving to be tougher than usual.

“Shoppers are definitely cautious these days,” says Paul Bielinski chief operations officer of Wisconsin-based Bielinski Homes. “They’re shopping more, they’re shopping competitors. You need to do something that makes it worth their time while they come in.”

To attract customers, homeowners are turning to promotions including free upgrades, especially in the kitchen.

Here at Point to Point, we think that this provides a tremendous opportunity for manufacturers. Not only to upsell to builders, but to strengthen your bond with them as you help them move these homes. Do you have the right selling tools to arm your builders to sell upgrades? Have you considered promotions to homeowners? By working together with builders to help them solve this challenge, you have a unique opportunity to build true brand loyalty.

From: Milwaukee Journal Sentinel

Slow? Not in commercial construction While the housing market may be struggling, the same can’t be said for commercial construction.

Jim Haughey, director of research and analytics for Reed Construction Data says, “The slow economy is not going to be a bad thing for the construction market.” In fact he predicts the best periods of growth are still ahead. And he should know -- he’s been forecasting the construction market for decades.

Haughty sees 5.7% growth in 2007 and points to several factors to back up his prediction.

1. America needs more capacity. We’re running out of space to put people and things, so we’ll need to build. Business investment in capital goods will continue to grow at 8% or more a year. Plus, corporate profits are up 45% over the last three years.
2. Thanks to fiscal improvements at the state and local levels, schools are pushing for modernization and revisiting construction plans that had been put on the shelf over the past few years. K-12 contracts are seeing a 4% growth and college/university construction has seen a 19% gain over last year.
3. The cost of credit will still be bargain-basement, so borrowing will not be a problem.

And while there is an expected bump in wages and a dearth of entry-level construction workers, the future for commercial construction still seems rosy.

If you’re a manufacturer that markets to both residential and commercial markets, have you examined your budgets to ensure that you are allocating enough dollars to the commercial segment?

Compiled From: Building Design & Construction and construction.com

No slump in the green building market One way to stay out of the red is to look toward “green.”

Green home building, currently a $7 billion business, is expected to be a $20 - $38 billion business by 2010. And that just accounts for new construction – the remodeling market is an entirely different opportunity. By the end of 2007, there will be as many builders heavily involved in green building (at least 60% of their projects are green) as those with low involvement (less than 15% are green projects).

Are your marketing plans poised to help you get your share of this growth?

From: construction.com

Cut market spending in a down economy? That could hurt Some facts to consider before you take the machete to your marketing budget:

McGraw Hill studied US recessions and their impacts on 600 companies. The bottom line? Since 1941, advertising has been the key to surviving and prospering in a recession.

Firms that maintained or, even better, increased their advertising expenditures during the 1981-1982 recession averaged significantly higher sales growth (both during the recession and for the following three years) than those that eliminated or decreased advertising.

Six other studies commissioned by American Business Media showed that advertising aggressively during recessions not only increases sales but also increases profits, This has been true for all studies since 1949.

In other words, sit out the game for a few months, and you may find it hard to get back on the starting team.

From: Business Leader

Women: Making an impact on home buying As a manufacturer of building products, it’s helpful to know who the builders you’re selling to are selling to. And more and more often, the answer is women.

In fact, according to the latest figures, women have made 21% of all recent home purchases, and are responsible for making the final decision about a home an incredible 87% of the time.

Single women, specifically are buying homes at record rates. In 2000-2003, for example, unmarried women spent $550 billion in real estate nationally, and accounted for 30% of condo sales in 2002. And The National Association of Realtors discovered that in 2003, twice as many single women bought their first home as single men.

It’s a trend that seems to be gaining steam.

As such, builders and developers have begun marketing to this group, and are designing layouts with the woman home buyer in mind.

Meritage Homes (San Diego), for example, has created separate workspaces for men and women. It has added open loft areas on the second floor and located laundry rooms and craft rooms near the kitchen. It has also created homes specifically for moms and females who are working from home.

Women’s taste in homes tend to run more toward safety and community – with a preference for stable urban areas over fringy up-and-coming neighborhoods that might afford more space, but less convenience and security.

Compiled From: terrydavis.livejournal.com and skydevelopment.us

Minority homebuyers: housing’s future Right now, it may look like new home buyers have dropped off the planet. But consider these figures from a recent Harvard University study: An average of about 1.4 million new households formed every year between 2000 and 2005, up 225,000 from the previous five years.

In fact, so many new households have formed that projections have been revised upward by more than a million households to 14.6 million by the next decade. That’s two million more households than in the previous decade. So, there should be no shortage of prospective customers in the years to come.

Who are these future buyers? For the most part, they’re minorities. Over the next 10 years, minorities are expected to account for a record 71% of household growth. Hispanics represent the fastest-growing group. The National Association of Hispanic Real Estate Professionals reports that 2.2 million Hispanics will enter the housing market between now and 2010, accounting for $500 billion in sales volume.

The Asian community is the second-fastest growing group, with a 69% growth rate in household formation.

And whatever minority group you talk to, most are going to be looking for a new home, instead of an existing one.

According to a recent study by Weston Edwards & Associates (Laguna Beach, CA), 47% of Hispanic buyers, 46% of African-American buyers and 40% of Asian buyers would rather buy a new home.

But there are challenges. These minority groups, by and large, have many misconceptions about the home buying process and financing. As a result, builders are pursuing more street-level activities, such as partnering with churches to present homeownership education seminars, having booths at community events and doing interviews about homeownership on foreign-language stations.

If these issues are properly addressed, the growing minority market represents a significant opportunity for long-term growth for both builders and manufacturers of building products.

From: Builder

Modular housing looking better and better It seems that modular housing is quickly gaining popularity. For one, the areas that were hardest hit by Hurricane Katrina are seeing modular homes as a major contributor to the region’s recovery. Secondly, and more relative to the rest of the country, modular homes now offer many of the same dramatic elevations traditional homebuilders offer.

But there’s one major difference: modular homes cost far less. In fact, they’re right in line with big production builders’ pricing.

Modular homes are doing more than just opening doors for homeowners, they’re also helping small production builders compete with the big public builders. With the ability to be utilized in attached housing, multifamily and mixed-use applications, modular offers flexibility not often associated with small production builders. What’s more, CAD and computerized systems building operations give these builders scores of customization options.

But, of course, modular’s claim to fame has always been speed. Many construction times can be shortened by about 35% by going modular. And there are seldom weather-related breaks.

From: Professional Builder

In tough times, it pays to know your market It’s hard enough to get your customers to respond to your marketing efforts during good times. But what about during tough times? Is it even possible to get your message through? Absolutely. You just need to know how to talk to them. Once you know into which discipline a corporation falls, you can cater your marketing efforts. Because when the economy turns south, corporations turn to what they know best – their discipline.

Operational Excellence | Corporations that take this position focus on their internal operations. They believe a highly efficient organization can drive down costs. If you can show your product or service will reduce expenses or streamline operations, you stand a better chance of being heard.

Product Excellence | If you know a company that’s constantly pushing the envelope developing product innovations or creating new technologies, this is probably their category. If you can help them be first into the marketplace, accelerate their product development or create new product categories or extensions, your marketing efforts should highlight it.

Customer Intimacy | This position is held by corporations that truly know their customers’ businesses and work hard to improve them. The key to marketing to these types of corporations is showing how you can help deepen their relationships.

Trusted Expert | When a corporation takes a stance in displaying expertise in a subject, you’re looking at the Trusted Expert position. By touting their vast knowledge, they enhance their persona, therefore propelling the sales of their products. When marketing to this type of company, demonstrate how you can boost their image even higher.

From: MarketingProfs.com