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>>>This is clearly not a cost issue Nope, that's exactly it - it's cheaper and faster for the builder to frame a house small and simply. They've found that peo

by patmcc 11y ago

>>>This is clearly not a cost issue Nope, that's exactly it - it's cheaper and faster for the builder to frame a house small and simply. They've found that people spend money for houses based on location, size, and the visible stuff (like nice paint jobs and shiny appliances). They could spend twice as long as 40% more in materials and the home would sell for 2% more - not worth their time.

hrktb 11y ago
To chime in, even in places where people are willing to pay a premium for construction materials and architecture (like in sismic areas) there is numerous cases of the builder cheaping out and osometimes illegally trying to get away with fewer material. The last months there was again a case of a building constructor using less structural elements than it was legally required to, also violating the number specified in the blueprintS.
- jonnathanson 11y ago
  It seems like one of those cascading series of perverse incentives up and down the value chain. The subcontractors want to cut corners with the contractor. The contractor wants to cut corners with the developer. The developer wants to cut corners on the project in general, passing the headache onto the buyer at some point after the eventual sale. Almost no one in this mess has incentives aligned with doing things correctly. If buying and moving homes were a more frequent event, buyers would play more "rounds" of this game and eventually become wiser to the ground rules of it. Reputation would start to matter, and developers, contractors, et al., would need to work harder to ensure they didn't get dinged. As it now stands, except in the luxury market, really, where people custom build homes, no one cares about a developer or contractor's reputation. So they don't have any reputational risk on the line. So they happily cut corners wherever they can get away with it. (And I'm willing to bet that even the luxury/custom buyer barely has a clue when it comes to evaluating the quality of construction and materials.)
  - spc476 11y ago
    Back in 1999, an acquaintance of mine bought a $2.3MM home in an exclusive neighborhood. As he was driving me and a few friends through his neighborhood, he explained that all the houses could be knocked down and rebuilt if desired. The price included location, security (theater really, but hey, it sells), footage, looks and fancy appliances. Not quality.
  - stephengillie 11y ago
    Some of them "roll" their business over every few years - starting a new company, transferring to it all assets (and maybe some liabilities), rehiring the workers, and then shutting down the old company. This way they get a new name and reputation as often as most people get a new house.

by patmcc 11y ago

hrktb 11y ago

To chime in, even in places where people are willing to pay a premium for construction materials and architecture (like in sismic areas) there is numerous cases of the builder cheaping out and osometimes illegally trying to get away with fewer material. The last months there was again a case of a building constructor using less structural elements than it was legally required to, also violating the number specified in the blueprintS.

jonnathanson 11y ago
It seems like one of those cascading series of perverse incentives up and down the value chain. The subcontractors want to cut corners with the contractor. The contractor wants to cut corners with the developer. The developer wants to cut corners on the project in general, passing the headache onto the buyer at some point after the eventual sale. Almost no one in this mess has incentives aligned with doing things correctly. If buying and moving homes were a more frequent event, buyers would play more "rounds" of this game and eventually become wiser to the ground rules of it. Reputation would start to matter, and developers, contractors, et al., would need to work harder to ensure they didn't get dinged. As it now stands, except in the luxury market, really, where people custom build homes, no one cares about a developer or contractor's reputation. So they don't have any reputational risk on the line. So they happily cut corners wherever they can get away with it. (And I'm willing to bet that even the luxury/custom buyer barely has a clue when it comes to evaluating the quality of construction and materials.)
- spc476 11y ago
  Back in 1999, an acquaintance of mine bought a $2.3MM home in an exclusive neighborhood. As he was driving me and a few friends through his neighborhood, he explained that all the houses could be knocked down and rebuilt if desired. The price included location, security (theater really, but hey, it sells), footage, looks and fancy appliances. Not quality.
- stephengillie 11y ago
  Some of them "roll" their business over every few years - starting a new company, transferring to it all assets (and maybe some liabilities), rehiring the workers, and then shutting down the old company. This way they get a new name and reputation as often as most people get a new house.