Last week Doug and Laurie traveled to Oklahoma for a Builder 20 meeting. Builder 20 is a club created by the NAHB (National Association of Home Builders) – there are lots of these clubs. Limited to 20 members – they are matched up with other builders all over the country (with a process that involves recommendations and interviews) so that none of them compete in the same markets. That sounds nice, huh? Other people in your industry to talk shop with, bounce things off of or talk about problems with . . . well, it is really much, MUCH more than that.

“The Builder 20 members are really our Board of Directors.” That is what Laurie McSpadden shared with me when we had a chance to sit down and talk yesterday in Lake Wylie. “We show each other everything – from financials to projects to goals – and we absolutely hold each other accountable!” She was very enthusiastic about their Builder 20 club and hands down believes they have had a huge hand in where McSpadden is today; and recommends joining a Builder 20 to any home builder.

Other than working with each other’s businesses however, the club also meets to discuss the industry at large. The take aways from that discussion I think are very interesting:

1. The Market is back to pre-2008 numbers in regards to people looking to build custom homes. Great news, right? But, production of materials is down due to the lean years we experienced in the design/build market (supply and demand) so building materials are a) not readily available and b) they cost more.
2. Lack of Trade Contractors is a problem nationwide as well: lots of carpenters, roofers, brick masons and the like left the industry during the down time and are working in other industries now. So there just aren’t as many. The ones that are left are very busy and charging “top dollar” (again: supply and demand) so that raises the cost of home building as well.
3. The first two take aways obviously contribute to the third: appraisals are not coming close to the actual cost of the homes to build! There is a big gap that has to be addressed from the beginning of each project.

Doug and Laurie also have an agenda for each Builder 20 meeting. They both go into it looking for two “Gold Nuggets” of information or advice that they believe will really help them move McSpadden Homes forward toward their own goals. Interestingly enough, I was not able to pry this Oklahoma meeting’s nuggets from them. I guess it wouldn’t be that smart to share everything!