Start-up Welcome Homes poised to revolutionize homebuilding

“Custom homes are out of the reach of most people,” Burford said. “They’re very expensive to do. You have to make a lot of sunk cost investment up front on design and engineering review of land and quite frankly sometimes that goes nowhere. You can spend $10,000, $15,000 evaluating a piece of land and find out you can’t build a house on top of it. So, we’ve removed that uncertainty.”

Read more: Compass rolls out homebuying and selling service

Then there’s that time element: “Another thing is we shortened the time period,” Burford said. “Doing a custom build easily takes 24 months. We can build a house within seven months of getting a permit. If you can afford a house in the million-dollar range, at least in the Northeast, you might not be able to afford the time to do that. We really help them from a time investment standpoint.”

Agents stand to benefit as well, he suggested: “And from the agent’s standpoint, they don’t have to do design meetings or anything. That’s all done for them. They get excited because if our base price of the home for a smaller home is $600,000, we work with the buyer and they end up doing $115,000 in upgrades, guess what? The agent gets paid on those upgrades.”

The agent realm was recently boosted thanks to a nascent marketing agreement signed with Compass largely toward the end of better training, bolstered incentives and bigger commission payouts, Burford noted. Gordon Golub, regional vice president at Compass, explained the impetus behind the agreement: “The way people buy and sell real estate has evolved more in the last two years than any other time in recent history,” he said in a prepared statement. “Brokerages that innovate the fastest will be able to bring the most value to their agents and in turn their clients. Our relationship with Welcome Homes is a great example of adding value in the midst of this great evolution that we are experiencing as a company and an industry. There could not be a better time to form this relationship because of the existing inventory shortage in today’s market.”