Melbourne, FL – February 16, 2014 – A couple of weeks ago, we posted a blog in this space briefly recounting the historical development of the LifeStyle Homes Energy Efficiency Initiative. You can find it two clicks to the right. The major purpose of that piece was to thank again our building scientist friends at the Florida Solar Energy Center for their expertise and encouragement which led to our introduction of guaranteed HERS 60 LifeStyle SunSmart(SM) homes in 2010. We also mentioned that it was our co-founding partner, Larry Hufford, who set us in the direction of using energy efficiency as our way to add value to our new homes in order to attract buyers in a market that was falling apart all around us.
Allow us to return to that decision for a moment, please, to comment on the courage it took to make it. Conventional wisdom, common sense and a ton of economic theory suggests that as the price of an object for sale goes up, the demand to buy that object will go down. Home builders have long accepted the way to increase sales is to cut prices, which of course, means cutting costs. The only real way to cut costs in home building is to take things out of the structure. Taking things out can continue for only so long before the durability of the home itself is compromised.
Even so, home builders who are locked in tight competition for scarce buyers, routinely conduct price wars with each other, cutting their margins to the bone (They really do!) on the theory that the lowest price will win the sale. Raising costs and thus prices is seen as the kiss of death.
And yet, all around us are premium-priced products that sell quite well, because the people who buy them believe that they deliver superior value that makes the increase in price worthwhile. So it is that LifeStyle Homes took the path of providing superior value as its way to survive in tough times. And the proof is in. Our customers were willing to buy the homes we wanted to build for them, even when their friends must have been questioning their sanity, because they were convinced moving up to a LifeStyle SunSmart(SM) home it would be the right thing to do for themselves and their families.
Delivering superior value has always been the way for LifeStyle Homes. We just upped the ante when upping the ante took some real courage. And, we continue on that path today, as we celebrate our 30th Anniversary in business. Behind the scenes, we continue to push in every way we can to get to our real goal of providing affordably-priced new homes that make enough of their own electricity to run the home and pay for recharging two electric automobiles overnight.
We invite you to join us in our journey. We promise that you will feel good about doing something good for your family and our environment! And here’s the best part! Owning a superior LifeStyle SunSmart(SM) home doesn’t have to cost you more even though it costs us more to build it. “How can that be,” you say? “You just finished a lecture on the economics of pricing that says it’s impossible to add to costs without adding to price!” Yes, but we left out the real magic of building science – cost neutrality – an engineering principle that guarantees a dollar saved in monthly electricity costs for every additional dollar the homeowner may have to make in monthly mortgage payments.
Yes, the price for the home will be higher. But for most people, the price is only a number which appears one time on the purchase contract. Only cash buyers ever pay the price. What’s more important for most people is the affordability of the monthly mortgage payment they have to make. But, since homeowners have to make monthly electricity payments also, it’s easy to think about combining the two and calling them monthly ownership cost. If we can save you a dollar on the electricity side for every dollar added on the mortgage side, we have delivered you a cost neutral opportunity. The cost neutral opportunity to own a LifeStyle SunSmart(SM) home will put you into a markedly superior home for no increase in ownership cost. It’s a great deal, and it’s for real. Ask us, and we will walk you through the specifics.