WEBVTT 00:00:00.000 --> 00:00:03.040 Ever wonder what really happens behind the scenes 00:00:03.040 --> 00:00:05.379 in construction, real estate, and development? 00:00:06.080 --> 00:00:08.240 We pull back the curtain on the new home construction 00:00:08.240 --> 00:00:11.080 industry, the real estate market, and the trends 00:00:11.080 --> 00:00:14.080 shaping it all. Discover the stories, insights, 00:00:14.279 --> 00:00:16.239 and expertise behind the process of building 00:00:16.239 --> 00:00:19.620 a new home. Join us for Trust the Process podcast, 00:00:20.000 --> 00:00:22.510 and let's build something great together. Welcome 00:00:22.510 --> 00:00:25.210 back to Trust the Process, the podcast where 00:00:25.210 --> 00:00:28.910 we talk about new home industry, real estate, 00:00:29.390 --> 00:00:32.909 construction, and everything in between. As we 00:00:32.909 --> 00:00:35.030 go about our days, obviously we work in the real 00:00:35.030 --> 00:00:38.789 industry. We get a lot of questions. Yeah. Yeah. 00:00:38.990 --> 00:00:41.429 So thought it would be fun to put that out to 00:00:41.429 --> 00:00:44.409 you guys and let you lead us in some of the questions 00:00:44.409 --> 00:00:48.539 or topics that you wanted to hear. So with that 00:00:48.539 --> 00:00:51.060 we got some good response and and so we're gonna 00:00:51.060 --> 00:00:55.060 jump into some of these questions and Maybe if 00:00:55.060 --> 00:00:56.880 somebody else had the question is something you 00:00:56.880 --> 00:00:59.100 might be wondering too. So hopefully we can answer 00:00:59.100 --> 00:01:00.619 some of them Here's a good one. This one actually 00:01:00.619 --> 00:01:03.340 came up for us this week in a client conversation 00:01:03.340 --> 00:01:08.280 So that is an oh, yeah This is really good. And 00:01:08.280 --> 00:01:11.659 I think this is a developing situation This is 00:01:11.659 --> 00:01:13.879 what do you think the NAR settlement means for 00:01:13.879 --> 00:01:16.019 builders? This could probably be it an entire 00:01:16.019 --> 00:01:19.299 episode. I agree. No, yeah, it could. It probably 00:01:19.299 --> 00:01:21.359 could. But there's probably so much content out 00:01:21.359 --> 00:01:23.719 there for this. But for anyone who's not following 00:01:23.719 --> 00:01:26.040 it, that's maybe in our audience. Essentially, 00:01:27.120 --> 00:01:30.799 the class action lawsuit judgment came down in 00:01:30.799 --> 00:01:35.219 August that said listing brokers can no longer 00:01:35.219 --> 00:01:38.530 advertise buyer agent commissions. And buyer's 00:01:38.530 --> 00:01:40.230 agents have to negotiate directly with their 00:01:40.230 --> 00:01:42.730 buyer how much they're going to charge. And you 00:01:42.730 --> 00:01:44.989 can ask for that as part of your contract when 00:01:44.989 --> 00:01:47.290 you present your offer. But every offer is going 00:01:47.290 --> 00:01:49.569 to have unique compensation. So that buyer might 00:01:49.569 --> 00:01:53.049 be working for 1 % or 2 % of that buyer's agent, 00:01:53.049 --> 00:01:55.549 I mean. So they might ask for these varying levels 00:01:55.549 --> 00:01:57.590 of commission that is going to affect the offer. 00:01:58.459 --> 00:02:00.400 When you're a developer, you're a seller more 00:02:00.400 --> 00:02:02.000 than anything, right? I mean, really, I have 00:02:02.000 --> 00:02:04.540 to sell X number of homes this year and next 00:02:04.540 --> 00:02:06.819 year and hopefully for many years to come. So 00:02:06.819 --> 00:02:11.080 I have a policy in place that I have a set number 00:02:11.080 --> 00:02:13.020 that I'm willing to give to someone who brings 00:02:13.020 --> 00:02:16.180 me a buyer. And what I'm doing is I'm rolling 00:02:16.180 --> 00:02:19.639 that into one larger percentage. And then the 00:02:19.639 --> 00:02:23.780 buyer, let's just call it 5%. the buyer can have 00:02:23.780 --> 00:02:25.699 that discussion with their agent to say, hey, 00:02:25.759 --> 00:02:27.879 can we keep 3 % of this to pay for our closing 00:02:27.879 --> 00:02:31.340 costs and you have 2 % compensation. That's a 00:02:31.340 --> 00:02:33.860 conversation between them and the buyer, the 00:02:33.860 --> 00:02:37.340 buyer's agent. So I am not privy to that at all. 00:02:37.379 --> 00:02:39.439 I don't care how it goes because I've conceded 00:02:39.439 --> 00:02:41.919 to this dollar amount. I was used to paying commissions 00:02:41.919 --> 00:02:44.340 anyway, so I've conceded to this dollar amount, 00:02:44.560 --> 00:02:46.060 this percentage and it's per house, depending 00:02:46.060 --> 00:02:48.340 on how desirable I think the home is or neighborhood. 00:02:48.750 --> 00:02:50.650 So there's one neighborhood that I just dialed 00:02:50.650 --> 00:02:52.229 it up an extra percent across the board because 00:02:52.229 --> 00:02:53.569 we have a lot of homes to get rid of in there 00:02:53.569 --> 00:02:56.370 and it's a slow -removing market and I want to 00:02:56.370 --> 00:02:58.629 get some of those off my book. So I feel that 00:02:58.629 --> 00:03:01.750 that's a good enticing way for me to drive traffic. 00:03:02.210 --> 00:03:04.250 So I think it's overall a good thing. I think 00:03:04.250 --> 00:03:06.729 that it's forcing buyer's agents to be more transparent. 00:03:07.289 --> 00:03:09.229 It's allowing sellers a lot more flexibility. 00:03:10.430 --> 00:03:12.870 you're seeing that kind of maybe a not so good 00:03:12.870 --> 00:03:15.530 offer is matched with a not so good compensation 00:03:15.530 --> 00:03:17.810 because that buyer's agent's bringing you a non 00:03:17.810 --> 00:03:20.430 -phenomenal is the buyer you could probably get 00:03:20.430 --> 00:03:21.990 walking out on the street and find that kind 00:03:21.990 --> 00:03:24.569 of buyer. So I like that it's more tied to the 00:03:24.569 --> 00:03:28.939 other terms of the offer. So I think for builders, 00:03:29.300 --> 00:03:31.000 I don't you know, most builders are gonna have 00:03:31.000 --> 00:03:32.919 to come up with some sort of policy and I'm small 00:03:32.919 --> 00:03:35.099 So I can't imagine, you know, these other larger 00:03:35.099 --> 00:03:36.879 builders just said no This is just what we're 00:03:36.879 --> 00:03:38.819 offering out. So I don't think it affects builders 00:03:38.819 --> 00:03:40.460 that much but it is putting downward pressure 00:03:40.460 --> 00:03:44.680 on commissions I feel so I think if I can Still 00:03:44.680 --> 00:03:47.400 have the same amount of traffic or when I keep 00:03:47.400 --> 00:03:50.740 my rates normal that I'm willing to pay out that 00:03:50.740 --> 00:03:52.360 will maybe drive traffic because everyone around 00:03:52.360 --> 00:03:54.979 me is sure bringing home, holding down their 00:03:54.979 --> 00:03:57.860 rates that they're paying. And when it was first 00:03:57.860 --> 00:03:59.879 announced or when the settlement first came down 00:03:59.879 --> 00:04:02.240 in, I believe it was July of 2024. Yeah, July 00:04:02.240 --> 00:04:06.080 implemented by August, yeah. I think there was 00:04:06.080 --> 00:04:08.139 a fear that surrounded it and everybody kind 00:04:08.139 --> 00:04:09.840 of went into a panic. Builder's World wasn't 00:04:09.840 --> 00:04:12.740 sure how it would affect them on that side. Sellers, 00:04:12.919 --> 00:04:14.599 agents, listing agents, all of that. Everybody 00:04:14.599 --> 00:04:18.519 kind of had a little moment, if you will. But 00:04:18.519 --> 00:04:20.699 overall, I think it's been a pretty non -issue. 00:04:20.740 --> 00:04:24.850 I mean, I agree that it's... causes or it forces 00:04:24.850 --> 00:04:27.329 agents to be more transparent. It's a conversation 00:04:27.329 --> 00:04:29.410 that wasn't being had before, that was being 00:04:29.410 --> 00:04:32.470 had in somewhat, I don't want to say shady, but 00:04:32.470 --> 00:04:37.029 it just wasn't in a pure light. So I think it 00:04:37.029 --> 00:04:39.269 just brings that to the forefront. Commissions 00:04:39.269 --> 00:04:42.069 are real. It's part of the real estate industry 00:04:42.069 --> 00:04:44.709 and part of how homes are transacted. And so 00:04:44.709 --> 00:04:47.930 having that as a forefront conversation with 00:04:47.930 --> 00:04:52.480 your buyer or seller I think is is a value add 00:04:52.480 --> 00:04:54.540 to them and to the whole experience and it creates 00:04:54.540 --> 00:04:56.740 a more professional environment for the industry 00:04:56.740 --> 00:04:58.939 as a whole. I think it makes it more competitive. 00:04:59.160 --> 00:05:00.779 Agreed. So anytime you have more competition, 00:05:00.920 --> 00:05:02.879 I think you have better outcomes. It might be 00:05:02.879 --> 00:05:04.459 bumpy for a little while in the beginning, but 00:05:04.459 --> 00:05:06.079 I think ultimately it will lead to better outcomes. 00:05:06.500 --> 00:05:08.180 But don't you think that a lot of the panic that 00:05:08.180 --> 00:05:10.220 was, I don't even want to call it panic, but 00:05:10.220 --> 00:05:13.439 a lot of the anxiety that was created by that, 00:05:13.899 --> 00:05:17.420 yes. Do you feel like you've seen... Yeah, I 00:05:17.420 --> 00:05:19.639 think it's subsided. I think that real estate 00:05:19.639 --> 00:05:22.240 is a high turnover business anyway. So I feel 00:05:22.240 --> 00:05:25.100 that there's maybe people that were on the fence 00:05:25.100 --> 00:05:26.819 to get out of the industry, maybe that forced 00:05:26.819 --> 00:05:27.800 them out of the industry. There are people who 00:05:27.800 --> 00:05:29.379 would have gotten in but didn't because they 00:05:29.379 --> 00:05:31.040 heard about the terminals. I think it's easy. 00:05:31.259 --> 00:05:34.639 It's easy to get into real estate. But if you 00:05:34.639 --> 00:05:36.600 don't have all of those pieces in place, you're 00:05:36.600 --> 00:05:38.160 just not going to survive it. So it made it more 00:05:38.160 --> 00:05:40.639 complicated. But I think it's a good thing. I 00:05:40.639 --> 00:05:42.439 agree. We'll leave better agents on the table. 00:05:42.920 --> 00:05:45.139 I agree. I agree. Good question. You know who 00:05:45.139 --> 00:05:55.519 you are. Yes. Next one. Let's talk about something 00:05:55.519 --> 00:05:58.569 close to my heart. I love that one. So yeah, 00:05:58.569 --> 00:06:00.829 let's talk about design. What do you think the 00:06:00.829 --> 00:06:03.970 future of design is? So there's a couple of, 00:06:04.089 --> 00:06:05.610 I mean, this could be home design. I'm just going 00:06:05.610 --> 00:06:07.149 to assume they're talking about everything. Yeah. 00:06:07.170 --> 00:06:09.430 What didn't clarify what exactly. So it could 00:06:09.430 --> 00:06:11.610 be, it could be any, it could be interior design. 00:06:11.790 --> 00:06:14.449 It could be functional design. Sure. So outside 00:06:14.449 --> 00:06:17.430 in, I think community design, community design. 00:06:17.610 --> 00:06:19.509 I would love to think maybe we see more mixed 00:06:19.509 --> 00:06:22.129 use. I would love to think we have more walkability, 00:06:22.129 --> 00:06:23.889 but I don't know if that's, if that's a pipe 00:06:23.889 --> 00:06:26.509 dream or not. So, uh, outside and I think, I 00:06:26.509 --> 00:06:29.420 think there will be, architecture and design 00:06:29.420 --> 00:06:32.240 is going to be informed by building costs because 00:06:32.240 --> 00:06:33.899 it is to this day because at the end of the day 00:06:33.899 --> 00:06:37.379 like we said the majority of new doors created 00:06:37.379 --> 00:06:41.019 are from production builders so they are penny 00:06:41.019 --> 00:06:44.560 pinchers and bean counters so the extra Eve embellishments 00:06:44.560 --> 00:06:47.259 and things that you may have seen in the 90s 00:06:47.259 --> 00:06:49.639 and early 2000s when margins were there to support 00:06:49.639 --> 00:06:52.740 that and there was more competition back to our 00:06:52.740 --> 00:06:56.250 income you know that the other kind of C word, 00:06:56.910 --> 00:07:00.750 the competition, that home building is so much 00:07:00.750 --> 00:07:02.569 more consolidated now, so home builders don't 00:07:02.569 --> 00:07:04.730 have to do that. In the most consolidated markets, 00:07:05.750 --> 00:07:06.810 for the heck of a better word, the homes are 00:07:06.810 --> 00:07:09.470 the ugliest, in my opinion. If you have only 00:07:09.470 --> 00:07:11.850 five or six publicly traded builders that are 00:07:11.850 --> 00:07:15.490 creating inventory, the pressure is not there 00:07:15.490 --> 00:07:17.689 to make a product that really stands out, especially 00:07:17.689 --> 00:07:20.050 when you're in a housing shortage. So I think 00:07:20.050 --> 00:07:22.879 from the outside in, we'll see. Cost informing 00:07:22.879 --> 00:07:25.560 a lot of exterior design, simple roof lines, 00:07:26.000 --> 00:07:27.939 a lot of simple footprints that are probably 00:07:27.939 --> 00:07:32.000 two story to capture land and capture the economies 00:07:32.000 --> 00:07:33.720 of building up versus building out. We're certainly 00:07:33.720 --> 00:07:36.420 seeing a lot of that. A lot of vertical three 00:07:36.420 --> 00:07:38.639 story to get a 19 on a square foot home and a 00:07:38.639 --> 00:07:40.879 footprint that may have only been a 1200. So 00:07:40.879 --> 00:07:43.220 we're seeing kind of I think those things informing 00:07:43.220 --> 00:07:45.079 design and then builders are doing their best 00:07:45.079 --> 00:07:50.279 to work within those constraints. Going inside 00:07:50.279 --> 00:07:53.480 with floor plans. I think that the era of the 00:07:53.480 --> 00:07:56.100 purely open floor plan might be drawing to a 00:07:56.100 --> 00:07:57.939 close I think you might start seeing especially 00:07:57.939 --> 00:07:59.819 in your larger homes I think you're gonna start 00:07:59.819 --> 00:08:01.420 seeing a little bit more room division again 00:08:01.420 --> 00:08:03.720 And I've read some blogs and that's some of that 00:08:03.720 --> 00:08:06.379 secondhand information, but I'm already feeling 00:08:06.379 --> 00:08:09.029 it from buyers and They're wanting those extra 00:08:09.029 --> 00:08:11.029 spaces, they're wanting those flex rooms where 00:08:11.029 --> 00:08:14.110 they can have pool tables or bars or offices. 00:08:14.110 --> 00:08:16.009 Right, still like the great room. Everybody still 00:08:16.009 --> 00:08:17.490 loves the great room concept. I think the great 00:08:17.490 --> 00:08:19.069 room concept will... But I think additional, 00:08:19.149 --> 00:08:20.889 kind of going back to that formal living or a 00:08:20.889 --> 00:08:23.009 den or a family room. I think those kind of third 00:08:23.009 --> 00:08:24.269 spaces that... So you've got the great room and 00:08:24.269 --> 00:08:26.930 then a separate... Yes, exactly. Those semi -private 00:08:26.930 --> 00:08:29.550 spaces. So I think we're going to see that and 00:08:29.550 --> 00:08:32.259 I think we're going to see... the emphasis on 00:08:32.259 --> 00:08:35.779 large kitchens still being ever -present. And 00:08:35.779 --> 00:08:38.639 I think in the luxury homes, we'll see now more 00:08:38.639 --> 00:08:40.820 than ever the prep kitchens and the mess kitchens. 00:08:43.759 --> 00:08:46.980 We've done some of that and it's been very, very 00:08:46.980 --> 00:08:49.419 well received. So I think we're going to see 00:08:49.419 --> 00:08:52.320 a lot of that. large pantries, we're going to 00:08:52.320 --> 00:08:55.220 see the Costco door maybe, it's a fire nightmare, 00:08:55.740 --> 00:08:57.340 but there are these little doors that go right 00:08:57.340 --> 00:08:59.460 from the garage into the pantry and it's usually 00:08:59.460 --> 00:09:02.039 a small door that only a kid could get through. 00:09:02.860 --> 00:09:05.259 Yes, it's kind of a dreamy thought. They call 00:09:05.259 --> 00:09:08.100 it a Costco door. Put your big water case or 00:09:08.100 --> 00:09:10.039 all those things right into the pantry. Yeah, 00:09:10.200 --> 00:09:11.720 so I think we're going to see kind of those little 00:09:11.720 --> 00:09:13.720 things in new home construction. I think we're 00:09:13.720 --> 00:09:16.039 going to see an additional push towards energy 00:09:16.039 --> 00:09:19.399 efficiency, so you may see... windows deleted 00:09:19.399 --> 00:09:21.740 and things you know those are all perforations 00:09:21.740 --> 00:09:24.480 in your home so you're gonna see that in the 00:09:24.480 --> 00:09:26.700 more middle market homes I think as you go into 00:09:26.700 --> 00:09:28.539 the luxury the indoor outdoor living at least 00:09:28.539 --> 00:09:31.379 in the Sunbelt is really emphasized I think that's 00:09:31.379 --> 00:09:33.840 that's not going anywhere getting bigger I agree 00:09:33.840 --> 00:09:35.580 in the luxury stuff the windows are only getting 00:09:35.580 --> 00:09:37.200 bigger the doors are getting bigger the window 00:09:37.200 --> 00:09:39.480 walls are getting bigger so I think that's kind 00:09:39.480 --> 00:09:41.600 of what we'll continue to see I think volume 00:09:41.600 --> 00:09:44.100 ceilings are going to be here to stay but that 00:09:44.100 --> 00:09:47.389 being said I think the The era of that great 00:09:47.389 --> 00:09:50.070 room. It's just one big room with a 14 -foot 00:09:50.070 --> 00:09:51.909 ceiling on a single story I think you're gonna 00:09:51.909 --> 00:09:53.610 start to see some more second and third spaces 00:09:53.610 --> 00:09:55.389 in those homes and in those floor plans that 00:09:55.389 --> 00:09:58.830 will get people kind of Refuge away from those 00:09:58.830 --> 00:10:01.750 big hard to hard to climatize hard to control 00:10:01.750 --> 00:10:04.570 rooms. So and then in terms of aesthetics I think 00:10:04.570 --> 00:10:08.110 we're in an era of earth tones and beiges and 00:10:08.110 --> 00:10:09.889 creams and I think we're getting away from the 00:10:09.889 --> 00:10:14.080 stark shiny finishes of the middle 2010s and 00:10:14.080 --> 00:10:16.759 the moderns. Do you agree? I do. That I agree 00:10:16.759 --> 00:10:18.639 with, yes. And that we definitely know is happening. 00:10:19.320 --> 00:10:21.639 So the warmer tones, earthy tones, all of that 00:10:21.639 --> 00:10:24.500 is really... Although we are seeing in design 00:10:24.500 --> 00:10:27.190 right now some... some big pops of color that 00:10:27.190 --> 00:10:29.629 are happening in the kitchen. So kind of the 00:10:29.629 --> 00:10:31.549 brighter, you know, I just saw what they were 00:10:31.549 --> 00:10:34.169 doing with it. Red cabinetry. Yes, which I don't 00:10:34.169 --> 00:10:35.870 have anything against red. It was just a lot 00:10:35.870 --> 00:10:37.769 in that particular home. And it was stitched, 00:10:38.110 --> 00:10:41.669 remember? Oh my gosh, that leather bridge that 00:10:41.669 --> 00:10:44.830 we saw was so pretty. So even in cabinetry, I 00:10:44.830 --> 00:10:46.750 saw one the other day that was kind of that, 00:10:46.750 --> 00:10:50.110 you know, the blue, that sort of powery blue 00:10:50.110 --> 00:10:52.909 countertop or cabinet, which, so we're seeing 00:10:52.909 --> 00:10:55.889 a lot of Colors popping back in so while most 00:10:55.889 --> 00:10:57.509 it's still a neutral. It's still going to be 00:10:57.509 --> 00:11:00.429 those earthy tones you're getting into the Away 00:11:00.429 --> 00:11:02.870 from the cold stark colors right into the warmer 00:11:02.870 --> 00:11:05.850 tones, and I think we'll see more color coming 00:11:05.850 --> 00:11:08.450 into kitchens moving forward colored cabinetry 00:11:08.450 --> 00:11:11.570 I agree You know still the white countertops. 00:11:11.570 --> 00:11:13.649 That's still the clean fresh look that most people 00:11:13.649 --> 00:11:17.389 are going towards so But agreed as far as colors. 00:11:17.529 --> 00:11:20.029 Mm -hmm. Yeah, these are things that it's important 00:11:20.029 --> 00:11:22.289 to know as a developer. It is. It is. And as 00:11:22.289 --> 00:11:24.350 you're a builder, you know, you're putting, we 00:11:24.350 --> 00:11:26.269 choose the selections. A lot of times we do. 00:11:26.389 --> 00:11:28.470 Every tile has to be selected, has to be chosen, 00:11:28.590 --> 00:11:30.350 has to be decided, and it has to be something 00:11:30.350 --> 00:11:33.289 that's neutral and relevant and on trend exactly 00:11:33.289 --> 00:11:35.149 with what's out there. Warrantable. You don't 00:11:35.149 --> 00:11:36.590 want to put a product that's a nightmare to warranty. 00:11:36.610 --> 00:11:39.830 Good point. Good point. Yeah, so. That was a 00:11:39.830 --> 00:11:41.570 good question. Design trends are, yeah, design 00:11:41.570 --> 00:11:43.669 trends are a big part of it. And especially as 00:11:43.669 --> 00:11:46.169 you backed it out into even. just the exterior 00:11:46.169 --> 00:11:50.090 design. So, love it, another good one. All right, 00:11:50.370 --> 00:11:51.909 so I have a couple more here. You have time for 00:11:51.909 --> 00:11:56.730 a couple more? I do, yeah, I do. Ooh, here's 00:11:56.730 --> 00:12:00.019 one. Ooh, that's a good one. That is a good one, 00:12:00.220 --> 00:12:03.440 AI, and this is something in the marketing world 00:12:03.440 --> 00:12:07.120 that I am up against a lot and a topic that is 00:12:07.120 --> 00:12:09.679 forefront for myself and everybody else in the 00:12:09.679 --> 00:12:12.700 marketing industry, so let's go with me. This 00:12:12.700 --> 00:12:15.779 question is asking, what do you think AI can 00:12:15.779 --> 00:12:18.299 do for building? I'm going to sub out building 00:12:18.299 --> 00:12:20.600 with developing because building is you could 00:12:20.600 --> 00:12:22.100 be a project management company, you could be 00:12:22.100 --> 00:12:26.610 doing whatever. constructing of the home. So 00:12:26.610 --> 00:12:29.549 to answer the direct question, I think it's going 00:12:29.549 --> 00:12:33.289 to be challenging to see AI improve scheduling 00:12:33.289 --> 00:12:36.409 and unless you're a really well -oiled machine, 00:12:36.690 --> 00:12:40.230 but construction is a messy, think on the fly 00:12:40.230 --> 00:12:43.389 problem solving in the moment, a lot of physical, 00:12:43.389 --> 00:12:46.269 tangible things that I don't think AI is going 00:12:46.269 --> 00:12:49.370 to do much for the building industry. I think 00:12:49.370 --> 00:12:51.570 that developing industry in terms of being a 00:12:51.570 --> 00:12:54.850 developer, I think maybe some of our economic 00:12:55.349 --> 00:12:58.190 analysis, we have one multifamily project that's 00:12:58.190 --> 00:13:01.029 needing an economist to kind of give us a proform 00:13:01.029 --> 00:13:02.750 on it because it's so many units and so many 00:13:02.750 --> 00:13:05.029 doors in order to get the funding for it from 00:13:05.029 --> 00:13:06.950 the banks. They're wanting to see an economist 00:13:06.950 --> 00:13:09.570 actually sign off on. Is it a viable project? 00:13:09.990 --> 00:13:12.809 Some of that thought work you might see some 00:13:12.809 --> 00:13:14.730 of the analysis or at least the compiling of 00:13:14.730 --> 00:13:18.409 data might really be streamlined by AI. Ultimately, 00:13:18.649 --> 00:13:20.649 no bank is going to sign off on a $50 million 00:13:20.649 --> 00:13:23.960 loan that was generated by an AI chat bot from 00:13:23.960 --> 00:13:27.480 Microsoft. So I think that you're always gonna 00:13:27.480 --> 00:13:29.700 want that human touch to do those, to kind of 00:13:29.700 --> 00:13:31.000 smooth out those edges. But I think a lot of 00:13:31.000 --> 00:13:33.460 the data harvesting and the analytics and just 00:13:33.460 --> 00:13:35.279 kind of compiling everything and getting it into 00:13:35.279 --> 00:13:38.320 digestible bytes is going to maybe be streamlined 00:13:38.320 --> 00:13:42.120 by AI. And I'm actually gonna ping pong it back 00:13:42.120 --> 00:13:44.500 to you for the marketing piece. What do you think 00:13:44.500 --> 00:13:46.539 marketing, how do you think marketing will be 00:13:46.539 --> 00:13:51.330 affected by AI? It already is affected by AI 00:13:51.330 --> 00:13:54.570 in so many ways and I was just gonna say last 00:13:54.570 --> 00:13:57.169 year when I went to CES conference here in Las 00:13:57.169 --> 00:14:00.889 Vegas and then the Builder Show National Association 00:14:00.889 --> 00:14:02.990 of Home Builders. CES' Consumer Electronics Show. 00:14:03.009 --> 00:14:04.830 Consumer Electronics and then the Home Builders 00:14:04.830 --> 00:14:08.950 Association. Two separate shows but... hot topics 00:14:08.950 --> 00:14:11.870 at both were AI and things like even just the 00:14:11.870 --> 00:14:13.590 refrigerators, you know, the refrigerators all 00:14:13.590 --> 00:14:15.610 have that component built into them. Now you 00:14:15.610 --> 00:14:17.250 can connect it to your phone and it can tell 00:14:17.250 --> 00:14:19.350 you temperatures and it can read, you know, the 00:14:19.350 --> 00:14:21.389 wine, the wine we've looked at at the builders. 00:14:21.710 --> 00:14:23.429 Yeah. You can take a photo of your wine and you 00:14:23.429 --> 00:14:25.950 can go to your. Yeah. So I think every, you know, 00:14:26.049 --> 00:14:28.409 your dishwasher and your washing machine, everything, 00:14:28.830 --> 00:14:32.169 all of the supplies and accessories that have 00:14:32.169 --> 00:14:35.470 gone into homes now are being. tapped into AI. 00:14:35.629 --> 00:14:37.889 As far as the marketing side, there are things 00:14:37.889 --> 00:14:41.690 about AI that, again, can't be done. I know people 00:14:41.690 --> 00:14:43.990 who work in the interior design industry, and 00:14:43.990 --> 00:14:49.769 they do entire homes through AI. And while, yes, 00:14:49.909 --> 00:14:52.590 it gives you a general idea, it's really, really 00:14:52.590 --> 00:14:55.710 hard to narrow in on exacts when you're using 00:14:55.710 --> 00:14:57.529 AI. What about that human touch? The other thing 00:14:57.529 --> 00:14:59.529 about AI is that you can't really use it for 00:15:00.439 --> 00:15:03.779 spoken, it's not good with fair housing. So it 00:15:03.779 --> 00:15:06.080 can say all these elaborate things, but there 00:15:06.080 --> 00:15:08.179 are things in fair housing that we can't say 00:15:08.179 --> 00:15:11.320 or that you would want to steer away from because 00:15:11.320 --> 00:15:13.559 we're not trying to pose the home to one buyer 00:15:13.559 --> 00:15:15.960 segment versus another and AI doesn't necessarily 00:15:15.960 --> 00:15:18.899 have that intuitive language to determine that 00:15:18.899 --> 00:15:22.460 on its own. So while it can create great descriptions 00:15:22.460 --> 00:15:24.480 and things like that, they always have to be 00:15:24.480 --> 00:15:25.799 read, they always have to be run through the 00:15:25.799 --> 00:15:28.460 filter of a human, otherwise you're not getting 00:15:28.460 --> 00:15:31.019 the human touch. I think so much is being lost 00:15:31.019 --> 00:15:33.720 through AI that now people are beginning to get 00:15:33.720 --> 00:15:36.379 that kind of washed out feeling and we're all 00:15:36.379 --> 00:15:40.139 kind of craving that bring it back to the real. 00:15:40.779 --> 00:15:45.240 So I hope we get back to real. I do had some, 00:15:45.559 --> 00:15:48.159 you know, there was a time where years ago, if 00:15:48.159 --> 00:15:51.000 you didn't jump in on the computer, you were 00:15:51.000 --> 00:15:54.019 getting left behind, right? computer was here 00:15:54.019 --> 00:15:55.440 and you have to get on the internet. We were 00:15:55.440 --> 00:15:57.220 all going to be using email someday. I mean years 00:15:57.220 --> 00:15:59.240 ago when people were going through that, I'm 00:15:59.240 --> 00:16:01.279 sure there was some resistance. But those people 00:16:01.279 --> 00:16:04.320 that never got a website... Are no longer in 00:16:04.320 --> 00:16:07.519 business. So if our competitors are using it, 00:16:07.539 --> 00:16:09.679 or they got into the group, right? They had to 00:16:09.679 --> 00:16:13.440 either do it or be out. So I think AI is that 00:16:13.440 --> 00:16:15.679 same thing. It was that moment where I kind of 00:16:15.679 --> 00:16:17.759 had to realize this doesn't feel good to me, 00:16:17.840 --> 00:16:19.740 but I know all my competitors are using it. Every 00:16:19.740 --> 00:16:21.340 other builder in the industry is using it. All 00:16:21.340 --> 00:16:22.779 the real estate agents in the world are using 00:16:22.779 --> 00:16:25.850 it. there has to be some piece of it that can 00:16:25.850 --> 00:16:29.570 streamline and help us too. So it's in my opinion, 00:16:29.889 --> 00:16:31.909 it's got to be a fine balance. And I think it's 00:16:31.909 --> 00:16:35.049 been so overused and so mass produced and every, 00:16:35.070 --> 00:16:37.269 every, everywhere that people are now beginning 00:16:37.269 --> 00:16:39.570 to crave that. Let's get back to the human touch 00:16:39.570 --> 00:16:43.110 again. Do you think we went too early? Do you 00:16:43.110 --> 00:16:45.730 think AI should have been tweaked and honed a 00:16:45.730 --> 00:16:49.029 little bit more before it kind of was thrusted 00:16:49.029 --> 00:16:51.190 onto the public and now we kind of have this 00:16:51.779 --> 00:16:55.460 I see a lot of AI imagery is very hollow, and 00:16:55.460 --> 00:16:57.379 you can spot it a mile away. You can see it a 00:16:57.379 --> 00:16:59.240 mile away? And when you read it a mile away, 00:16:59.460 --> 00:17:02.440 you see these auto replies from different people 00:17:02.440 --> 00:17:04.940 in different industries, and you can tell the 00:17:04.940 --> 00:17:08.839 email was AI. And now I guess there's AI email 00:17:08.839 --> 00:17:11.759 extensions that will draft responses to emails 00:17:11.759 --> 00:17:13.160 that come in, and then you can just go into your 00:17:13.160 --> 00:17:15.039 drafts and hit send, send, send. And I've been 00:17:15.039 --> 00:17:16.819 on the receiving end of some of those as recently 00:17:16.819 --> 00:17:20.180 as last week. And you read and go. Yeah. Or even 00:17:20.180 --> 00:17:22.079 the chat box online. If you're on somebody's 00:17:22.079 --> 00:17:23.740 website and you're trying to get a question answered 00:17:23.740 --> 00:17:25.240 and you end up with this chat box, you're like, 00:17:25.319 --> 00:17:28.259 this is clearly not a real person. I'm going 00:17:28.259 --> 00:17:29.799 to pick up the phone and call because I just 00:17:29.799 --> 00:17:33.039 need to talk to someone who can actually understand 00:17:33.039 --> 00:17:35.299 what I'm asking. Right. And we're asking this 00:17:35.299 --> 00:17:38.359 in... early part of 2025. So maybe this is like 00:17:38.359 --> 00:17:40.819 asking about the internet in 1989. I don't know. 00:17:41.119 --> 00:17:42.660 I don't know. So maybe it will get better. I 00:17:42.660 --> 00:17:47.339 don't see. I just updated our sales contract 00:17:47.339 --> 00:17:50.859 for our new home builds for what I call a piano 00:17:50.859 --> 00:17:53.700 disclosure. So a house is not a piano. It is 00:17:53.700 --> 00:17:56.220 imperfect. It's built on site by human hands 00:17:56.220 --> 00:17:59.240 out of imperfect, mostly natural materials. And 00:17:59.240 --> 00:18:00.819 as I was writing that, I realized, you know, 00:18:00.819 --> 00:18:02.779 it's one of those things that's why people love 00:18:02.779 --> 00:18:06.259 homes. It's so human. Mm -hmm, and everything 00:18:06.259 --> 00:18:08.819 is a little flawed. I mean, that's part of its 00:18:08.819 --> 00:18:11.599 charm, right? It's good good Yes, because imagine 00:18:11.599 --> 00:18:13.940 the image of your house. It would feel hollow, 00:18:13.940 --> 00:18:17.190 but you know your house has Dog scratches or 00:18:17.190 --> 00:18:19.049 whatever. It's like an artist you would much 00:18:19.049 --> 00:18:21.569 rather have a hand -painted versus some computer 00:18:21.569 --> 00:18:23.710 -generated image of that you'd write and I could 00:18:23.710 --> 00:18:26.250 be partial here Phil homes are art and I think 00:18:26.250 --> 00:18:29.190 that it's not going to you can I saw I've seen 00:18:29.190 --> 00:18:31.210 AI make architectural floor plans and again We 00:18:31.210 --> 00:18:33.569 might be talking about the internet 1989 has 00:18:33.569 --> 00:18:36.769 a long way to go, but it is an absolute train 00:18:36.769 --> 00:18:39.630 wreck It's just cannot be an AI doesn't know 00:18:39.630 --> 00:18:41.269 how humans live and how humans want to live and 00:18:41.269 --> 00:18:43.910 you can't train that Very hard, I mean I'm no 00:18:43.910 --> 00:18:46.069 AI expert, I barely know how to work my phone, 00:18:46.609 --> 00:18:48.829 so take what I say with a grain of salt. And 00:18:48.829 --> 00:18:51.369 when you say did we release it too soon, I don't 00:18:51.369 --> 00:18:53.410 know if they expected it to take off the way 00:18:53.410 --> 00:18:56.549 that it did. I think when they just brought level 00:18:56.549 --> 00:18:58.710 one chat GPT to the world, they thought let's 00:18:58.710 --> 00:19:01.410 just see what happens and it got so much response 00:19:01.410 --> 00:19:03.750 and so much momentum. And then it became a Wall 00:19:03.750 --> 00:19:06.309 Street darling. Yes, I think it's taken off the 00:19:06.309 --> 00:19:10.000 life of its own. Um, maybe it did grow too much 00:19:10.000 --> 00:19:12.420 too fast and get incorporated into too many other 00:19:12.420 --> 00:19:16.140 places that now there isn't, you know, it's just 00:19:16.140 --> 00:19:20.839 all washed out. Yeah. Next question. Um, that 00:19:20.839 --> 00:19:24.119 one we kind of covered. So this is a regulation 00:19:24.119 --> 00:19:27.859 bot wrote this, uh, regulation bot 2000. Why 00:19:27.859 --> 00:19:30.039 are you so anti -regulation? This person's got 00:19:30.039 --> 00:19:33.900 an axe to grind with me. Uh, I am not, I am not 00:19:33.900 --> 00:19:36.859 anti -regulation. I am frustrated by a lot of 00:19:36.859 --> 00:19:40.640 regulations. But I understand their place in 00:19:40.640 --> 00:19:42.799 the world. And we had kind of a whole episode 00:19:42.799 --> 00:19:45.920 on this. And I'm sad if that was the takeaway 00:19:45.920 --> 00:19:47.940 from that episode, that I was anti -regulation 00:19:47.940 --> 00:19:51.919 because I thought I was pretty emphatic. Appreciate 00:19:51.919 --> 00:19:53.680 regulation. Thank you. Yeah, I think you covered 00:19:53.680 --> 00:19:56.079 both sides of it and it isn't an anti -regulation 00:19:56.079 --> 00:19:59.079 Necessarily as much as the just the smart regulation 00:19:59.079 --> 00:20:01.099 put in place. Yeah, and the fact that regulations 00:20:01.099 --> 00:20:03.500 never thinned down They only amp up they only 00:20:03.500 --> 00:20:05.859 beef up. They only get thicker sludge here. Mm 00:20:05.859 --> 00:20:08.480 -hmm So I think those are the things so and that's 00:20:08.480 --> 00:20:10.720 a real part of home building It's a part of any 00:20:10.720 --> 00:20:12.619 industry But I think it's really a part of what 00:20:12.619 --> 00:20:15.140 you do and so there is the obstacles that are 00:20:15.140 --> 00:20:17.059 put in place and being transparent about that 00:20:17.059 --> 00:20:20.440 and admitting that This isn't easy and jumping 00:20:20.440 --> 00:20:22.539 through all of these hurdles and trying to, you 00:20:22.539 --> 00:20:24.980 know, cut all of these red tape and all the things 00:20:24.980 --> 00:20:27.599 that you have to do. What's so challenging about 00:20:27.599 --> 00:20:29.740 it is that it's so fragmented because building 00:20:29.740 --> 00:20:32.920 is largely dictated by the lowest form of your 00:20:32.920 --> 00:20:35.240 government. So whether it's a town, township 00:20:35.240 --> 00:20:37.339 or even an HOA, the first clearance I have is 00:20:37.339 --> 00:20:40.259 within a, if I'm building an existing HOA, my 00:20:40.259 --> 00:20:42.339 first step is getting it cleared with the lowest 00:20:42.339 --> 00:20:44.700 rung of government, the first, you know, circle. 00:20:45.099 --> 00:20:46.619 So you're clearing that, then you're clearing 00:20:46.619 --> 00:20:47.819 that, then you're clearing that, then you're 00:20:47.819 --> 00:20:49.500 clearing that. So there's just so many layers 00:20:49.500 --> 00:20:52.799 of it, whereas I feel like if I were building 00:20:52.799 --> 00:20:55.460 cars, you're dealing with mostly federal agencies, 00:20:55.519 --> 00:20:58.119 you're dealing with maybe I'm sure several. Again, 00:20:58.119 --> 00:21:02.460 I don't know how to build cars, but I can't even 00:21:02.460 --> 00:21:06.480 change my own oil or work my phone. But I just 00:21:06.480 --> 00:21:08.420 feel like what's so uniquely frustrating about 00:21:08.420 --> 00:21:10.299 developing and about housing and about building 00:21:10.299 --> 00:21:14.359 is just the layers of it and how it starts with... 00:21:14.329 --> 00:21:18.109 One person on a design review board can curtail 00:21:18.109 --> 00:21:21.069 or you can definitely derail your entire project 00:21:21.069 --> 00:21:23.049 and I've had it happen before one rogue board 00:21:23.049 --> 00:21:26.730 member on an HOA just didn't like me and made 00:21:26.730 --> 00:21:29.450 everything really challenging and when they and 00:21:29.450 --> 00:21:31.490 the reason I know it was them is because when 00:21:31.490 --> 00:21:33.930 they left the board my life got a lot easier. 00:21:34.450 --> 00:21:36.410 Interesting. So it was going from six month approvals 00:21:36.410 --> 00:21:39.089 to three month approvals. And some of that regulation 00:21:39.089 --> 00:21:42.869 I I feel like is that just regulation for regulation 00:21:42.869 --> 00:21:44.910 sake? That was what we talked about. And there's 00:21:44.910 --> 00:21:49.049 a difference between regulations and codes, which 00:21:49.049 --> 00:21:50.869 would be a totally different question. But maybe 00:21:50.869 --> 00:21:53.250 just answer that quickly if you want to. Because 00:21:53.250 --> 00:21:57.930 I think people are confused by the structure 00:21:57.930 --> 00:22:01.470 that's put in place. So a regulation would be 00:22:01.470 --> 00:22:04.950 you can have this many homes per acre. Or every 00:22:04.950 --> 00:22:07.210 10 homes per acre, you have to have one quarter 00:22:07.210 --> 00:22:09.670 acre of community space. That's more of a regulation. 00:22:09.829 --> 00:22:11.309 You could call that a development code, but it's 00:22:11.309 --> 00:22:14.289 more of a regulation. All codes are regulations, 00:22:14.329 --> 00:22:16.789 but not all regulations are codes. So every code 00:22:16.789 --> 00:22:19.990 is a regulation on the building industry. But 00:22:19.990 --> 00:22:22.990 a building code would be egress windows have 00:22:22.990 --> 00:22:25.190 to be 44 inches from the floor and have to be 00:22:25.190 --> 00:22:27.910 at least 30 inches wide and 30 and 24 inches 00:22:27.910 --> 00:22:29.630 tall or whatever, enough for a person to get 00:22:29.630 --> 00:22:33.329 out of. So that's a building code. A fire door 00:22:33.329 --> 00:22:34.829 going into the garage, it's a building code. 00:22:35.339 --> 00:22:38.220 versus a regulation. But those are also regulations. 00:22:38.920 --> 00:22:41.119 But a regulation that's not a code is something 00:22:41.119 --> 00:22:44.880 like park space or the fact that you need an 00:22:44.880 --> 00:22:46.460 HOA versus not. The fact that you have to have 00:22:46.460 --> 00:22:49.519 a hillside overlay study done, that's a regulation. 00:22:49.539 --> 00:22:51.559 The fact that you need a signature on this document. 00:22:52.119 --> 00:22:53.559 Yeah, the Water District has to sign off on it. 00:22:53.559 --> 00:22:55.339 Public Works has to sign off on it. A traffic 00:22:55.339 --> 00:22:57.500 study, all those things. For even a five -home 00:22:57.500 --> 00:23:00.240 subdivision has to have a traffic study. That's 00:23:00.240 --> 00:23:02.980 a regulation. That's I mean there can be you 00:23:02.980 --> 00:23:04.539 could just have a house party and there'd be 00:23:04.539 --> 00:23:06.400 more people You know what I mean from versus 00:23:06.400 --> 00:23:08.140 a five -home subdivision has to have a traffic 00:23:08.140 --> 00:23:10.359 study, but that's the study There's only five 00:23:10.359 --> 00:23:12.140 homes and this is only this much there's much 00:23:12.140 --> 00:23:14.819 traffic So yeah But we got to count the number 00:23:14.819 --> 00:23:16.920 of cars that are on on that road and how many 00:23:16.920 --> 00:23:19.799 trips are gonna be generated by these homes and 00:23:19.799 --> 00:23:21.440 Just part of it But those are the regulations 00:23:21.440 --> 00:23:23.799 that really slow things down and cost a ton of 00:23:23.799 --> 00:23:25.799 money. Mm -hmm And there's just not a lot of 00:23:25.799 --> 00:23:27.680 smartness to it. There's not a lot of surgical 00:23:27.680 --> 00:23:30.839 precision to say well If it's under 50 homes, 00:23:31.039 --> 00:23:32.619 you don't need this, this, this, this. That'd 00:23:32.619 --> 00:23:35.019 be a way of deregulating some of the industry. 00:23:36.579 --> 00:23:38.980 There's a lot of other regulations on street 00:23:38.980 --> 00:23:42.259 widths. And you're looking at a regular residential 00:23:42.259 --> 00:23:46.440 street might have a 45 foot wide street. And 00:23:46.440 --> 00:23:48.960 all that does is promotes on -street parking, 00:23:49.099 --> 00:23:50.839 clutters up the street, makes it hard for kids 00:23:50.839 --> 00:23:53.359 to play because we know the wider the street, 00:23:53.440 --> 00:23:55.200 the faster the car goes. We just know that. That's 00:23:55.200 --> 00:23:58.200 why back east or in small European towns where 00:23:58.200 --> 00:23:59.480 there's trees on both sides and the street's 00:23:59.480 --> 00:24:01.359 only 14, they barely have speed limits because 00:24:01.359 --> 00:24:03.799 you're going to go 20 miles an hour anyway. Because 00:24:03.799 --> 00:24:06.099 your mind is going to slow your car down. So 00:24:06.099 --> 00:24:08.240 I just feel like those are the regulations that 00:24:08.240 --> 00:24:11.420 do nothing, in fact, make suburbia less livable. 00:24:11.640 --> 00:24:14.500 And of course take up a ton more land every every 00:24:14.500 --> 00:24:16.099 single street being 15 feet wider than needs 00:24:16.099 --> 00:24:18.779 to be adds up over An entire just neighborhood 00:24:18.779 --> 00:24:22.220 let alone a city So those are the kind of regulations 00:24:22.220 --> 00:24:24.660 that are really hard to get behind because I 00:24:24.660 --> 00:24:28.380 don't see the logic to them. Mm -hmm. So Next 00:24:28.380 --> 00:24:32.140 question next question next question. I'm tired 00:24:32.140 --> 00:24:39.200 of this chat box We pass the green Let's see 00:24:40.059 --> 00:24:44.640 All right, how about Oh, this is a great one. 00:24:44.640 --> 00:24:46.700 I did touch on it a little bit, but you can circle 00:24:46.700 --> 00:24:49.980 back on that the yeah Yeah, it circles back on 00:24:49.980 --> 00:24:51.380 what we talked about a little earlier We kind 00:24:51.380 --> 00:24:52.920 of we kind of touch on this every time because 00:24:52.920 --> 00:24:54.599 it's something I'm really passionate It is and 00:24:54.599 --> 00:24:56.539 it's a question people have because we're all 00:24:56.539 --> 00:24:59.059 affected by and it is out there And the question 00:24:59.059 --> 00:25:01.500 is what do you think the biggest factor affecting 00:25:01.500 --> 00:25:07.160 them? They can't see it What do you think is 00:25:07.160 --> 00:25:09.039 the biggest factor so they're asking for one 00:25:09.359 --> 00:25:12.279 I can't give a multifaceted 20 -minute answer 00:25:12.279 --> 00:25:14.380 here. What do you think the biggest factor affecting 00:25:14.380 --> 00:25:19.960 home prices? It's supply. I mean, it's supply. 00:25:20.180 --> 00:25:22.279 So that's the bottom line. There's just not enough 00:25:22.279 --> 00:25:24.720 supply. We know that we're under building in 00:25:24.720 --> 00:25:26.779 Las Vegas alone by about 8 ,000 rooftops, I think 00:25:26.779 --> 00:25:29.579 we figured, based on household generation. So 00:25:29.579 --> 00:25:32.670 that is the biggest factor. How do you fix that 00:25:32.670 --> 00:25:34.670 is the zoning and the regulation and cutting 00:25:34.670 --> 00:25:37.069 that kind of thing and maybe incentivizing building 00:25:37.069 --> 00:25:39.309 instead of disincentivizing building and construction. 00:25:39.970 --> 00:25:44.930 Maybe tightening up some of the laws that consumers 00:25:44.930 --> 00:25:48.130 can sue builders for years after it disincentivizes 00:25:48.130 --> 00:25:52.650 builders. City governments can block development 00:25:52.650 --> 00:25:54.970 and ask for extra things and there's development 00:25:54.970 --> 00:25:56.750 fees. Those are all things that construct supply. 00:25:56.809 --> 00:25:59.150 But the simple answer is supply. When we had 00:25:59.150 --> 00:26:02.529 more supply, homes were cheaper. So, and is it 00:26:02.529 --> 00:26:05.470 just supply construction? No, there's also a 00:26:05.470 --> 00:26:08.069 lot of homes kept off the market, owned by hedge 00:26:08.069 --> 00:26:10.690 funds, owned second homes. There's a lot of reasons 00:26:10.690 --> 00:26:12.990 we have constrained supply. And then a housing 00:26:12.990 --> 00:26:14.730 market is something that becomes obsolescent. 00:26:15.150 --> 00:26:17.009 There's an obsolescence to the housing supply, 00:26:17.130 --> 00:26:19.029 right? I mean, the homes can only go for so long 00:26:19.029 --> 00:26:21.029 without either needing massive improvement or 00:26:21.029 --> 00:26:25.630 not fitting the bill anymore. We're starting 00:26:25.630 --> 00:26:28.309 to see some teardowns in our city where the land 00:26:28.309 --> 00:26:31.599 value has become... More than the home justifies 00:26:31.599 --> 00:26:34.400 or maybe against vacation in other cities So 00:26:34.400 --> 00:26:37.339 if you look at I think the National Association 00:26:37.339 --> 00:26:39.160 home builders assumes the functional life of 00:26:39.160 --> 00:26:41.720 the house is around 70 years So it doesn't mean 00:26:41.720 --> 00:26:43.380 that they fall down at 70 years, but it just 00:26:43.380 --> 00:26:45.519 means they would need such a substantial investment 00:26:46.039 --> 00:26:48.920 the original home is basically zero, because 00:26:48.920 --> 00:26:49.900 it requires so much investment. And the chances 00:26:49.900 --> 00:26:53.019 of it still being over time, somebody has done 00:26:53.019 --> 00:26:54.279 the upgrades numerous times by that point. Yeah, 00:26:54.640 --> 00:26:57.359 does it ever go a full 70 years? No, probably 00:26:57.359 --> 00:26:59.180 not. But then it only takes it back to 1950 when 00:26:59.180 --> 00:27:02.000 you think of 55. So that's not really, 70 years 00:27:02.000 --> 00:27:03.619 sounds like a long time. I'm picturing in my 00:27:03.619 --> 00:27:06.180 head a home from the 1920s, but that could be 00:27:06.180 --> 00:27:09.019 a 1955 Rambler, a little ranch home. Yeah. you 00:27:09.019 --> 00:27:12.559 know that yeah somebody's redone the roof somebody 00:27:12.559 --> 00:27:15.960 has ideal yeah but the thought is that over 70 00:27:15.960 --> 00:27:18.339 years they become basically worth zero they require 00:27:18.339 --> 00:27:21.660 so much so if you've not been maintaining okay 00:27:21.660 --> 00:27:25.359 so that affects supply as well okay and we'll 00:27:25.359 --> 00:27:29.940 take one more of the questions um and this one 00:27:29.940 --> 00:27:33.890 i i i like the thought on this one As we talk 00:27:33.890 --> 00:27:37.009 about your role as a developer and some of the 00:27:37.009 --> 00:27:39.049 obstacles that you face, what's the most challenging? 00:27:39.269 --> 00:27:41.430 What's the most challenging aspect of developing 00:27:41.430 --> 00:27:45.630 slash home building? It's the time. It's just 00:27:45.630 --> 00:27:48.069 the amount of time to bring something to market 00:27:48.069 --> 00:27:51.930 is the single greatest. And that is not just 00:27:51.930 --> 00:27:54.230 because of Regulate. It's just the time to build, 00:27:54.329 --> 00:27:57.750 the time to conceptualize. You're herding cats 00:27:57.750 --> 00:28:00.940 in many ways, right? Just to get my architect 00:28:00.940 --> 00:28:03.339 to deliver on time and then that over to my engineers 00:28:03.339 --> 00:28:05.259 and get everyone talking and those things just 00:28:05.259 --> 00:28:07.079 take time even if there were no regulations. 00:28:07.619 --> 00:28:09.519 So it's not just regulations that slows things 00:28:09.519 --> 00:28:12.539 down. These are really complicated projects that 00:28:12.539 --> 00:28:15.579 we do and we even if it's just an inside of an 00:28:15.579 --> 00:28:17.119 existing each way, it's still a house. It's going 00:28:17.119 --> 00:28:19.759 to be there for. Yeah. Functionally just 70 years. 00:28:21.160 --> 00:28:24.480 So I think that's the biggest challenge is just 00:28:24.480 --> 00:28:27.680 the time and the patience. It's. requires an 00:28:27.680 --> 00:28:32.319 astounding amount of patience. So that's my biggest 00:28:32.319 --> 00:28:37.559 kind of frustration slash thorn in my side. It's 00:28:37.559 --> 00:28:39.660 just the amount of time it takes to do anything. 00:28:41.200 --> 00:28:42.880 And the time requires patience. And the time 00:28:42.880 --> 00:28:45.000 requires patience and requires a lot of grit. 00:28:45.759 --> 00:28:48.710 That you have to have the stones to... to invest 00:28:48.710 --> 00:28:51.130 all this money up front or take on all this debt 00:28:51.130 --> 00:28:52.630 or a combination of both. You usually have a 00:28:52.630 --> 00:28:55.670 lot of money invested in and a lot of debt. And 00:28:55.670 --> 00:28:58.170 you just say, I hope this works because it's 00:28:58.170 --> 00:29:02.880 too far in now. Well, good I love it and thank 00:29:02.880 --> 00:29:05.480 you guys for sending the questions really good 00:29:05.480 --> 00:29:07.720 conversation that we were able to start here 00:29:07.720 --> 00:29:10.059 We'll do others So if you have questions or if 00:29:10.059 --> 00:29:11.500 there's something on your mind, you'd like us 00:29:11.500 --> 00:29:14.180 to address feel free to send it You can shoot 00:29:14.180 --> 00:29:17.180 it over to any of our online platforms and I 00:29:17.180 --> 00:29:19.299 will get those and we'll rally them together 00:29:19.299 --> 00:29:22.099 and address them in a future episode So thank 00:29:22.099 --> 00:29:25.539 you so much. Thank you shade it and we'll see 00:29:25.539 --> 00:29:29.059 you guys again next time on another episode of 00:29:29.059 --> 00:29:33.140 trust the process See you then. Bye bye. Thanks 00:29:33.140 --> 00:29:35.420 for tuning into the Press the Process podcast. 00:29:35.779 --> 00:29:38.160 Make sure to follow us on Spotify to stay in 00:29:38.160 --> 00:29:40.680 the loop with the latest insights, project updates, 00:29:40.880 --> 00:29:43.019 and everything in between. See you next time.