When it comes to dealing with the poor housing market, Pulte Homes’ Tucson Division President Shawn Chlarson says his company believes that "there are less days in front of us than behind us."
Chlarson said local Pulte staff members, many of whom had never seen a market downturn like this one, met recently for a training session to discuss the situation. They were reminded that during the early 1970s, there actually was a housing boom even greater with more housing starts than in the 2004-2006 boom before the bottom fell out then, too.
Lesson learned: Everything goes through cycles, and it always comes back. "This is a good long-term business to be in," Chlarson said, noting that many retiring baby boomers are planning to relocate and should spur continuing interest in new housing. But, Chlarson concedes, "the current environment will probably negate another 2004-2005 happening in my lifetime."
 Shawn Chlarson, president of Pulte Homes’ Tucson Division, at the company’s Sierra Morado development. |
Chlarson said Pulte has been in the Tucson market for 20 years and there was always about a 3 percent appreciation in home values up until the 2004-2006 boom, when home prices spiked upwards, then crashed back down to previous levels in the past year or two.
Chlarson believes internally, Pulte has several strengths that keep it competitive. First, it recently won recognition from J.D. Power and Associates as the Tucson area’s leading home builder in customer satisfaction—the sixth year in a row, Chlarson said.
"We do well as a corporation. The competition has gotten better over the past few years, but our company believes strongly in counting on a third-party validator like J.D. Power to evaluate customer satisfaction," Chlarson said, noting that Pulte has consistently provided customer relations managers to help home buyers while doing business.
Pulte follows a seven-step home-buying process that begins with a pre-construction meeting in which the entire team sets up the customer relationship. The company sets expectations relating to the whole buying experience that lasts long after the final sale has been made.
In addition to the pre-construction meeting, there is a pre-drywall meeting where customers learn about the structure of their homes, a quality assurance inspection, a pre-closing orientation, a post-closing visit, a three-month follow-up and an 11-month follow-up to address any problems that occur before the 12-month portion of the home warranty expires.
Pulte looks beyond the first-time home buyer, and takes an approach that tries to appeal to a broad variety of consumers. "Out of 13 different consumer groups," Chlarson said, "we target 11 of them."
And not all of them need home loans to complete the purchase. Chlarson said in the case of Pulte’s Sonora by Del Webb adult community recently closed out in Sahuarita, "over half the buyers came with cash."
Those buyers looking for the ultimate in green might find Pulte’s Sierra Morado an attractive choice. Located about 10 miles south of Interstate 10 just off Houghton Road, this complex, among other attributes, features solar-heated water, gray water capturing for landscape irrigation, and dual-flush toilets.
In the Tucson market, Chlarson said, Pulte has been following Environmentals for Living platinum-level requirements in its homes for the past 10 years. The Environmentals for Living program includes requirements concerning framing, thermal insulation, air tightness, drywall air sealing, mechanicals, ducts, ventilation, pressure balancing, carbon monoxide detection and moisture management.
While home builders may come or go, especially in the current volatile market, Chlarson said Pulte Homes is in the Tucson market to stay. The company has made a major commitment here and already has plenty of improved lots for future growth.
For example, out of 1,526 available lots in Sierra Morado, just 300 have been built out, and with 3,600 to 3,900 available lots in Red Rock, there will be 400 closings by the end of the year. In addition, the company has smaller communities with lots available in locations between those two sites.
One might think that Red Rock, which is about 20 minutes north of Marana, could pose a challenge in times of high fuel costs, but Chlarson said buyers can purchase a home for about $20,000 less than an equivalent unit closer to the city. "They do some calculations and find that it’s still worth the fuel costs," he said.
Long-term, Chlarson sees an increasing number of baby boomers coming to Tucson for the great weather and affordable living costs. "A lot of retirees go to Phoenix to look (for a new home). About 10 percent of them end up coming down here to look too, and that’s still a huge number." Those who do come to Tucson to look often end up liking the more natural desert environment and end up buying here, he said.
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