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[Below is a transcript of the podcast]
Cheri Landin: Hello and welcome to our community podcast which this month is on affordable housing. We all know that here in the Denver market, the population has absolutely exploded over the last several years and I really don’t see any stopping that trend. There are so many businesses that have decided to start up here. There are so many other companies that are relocating employees here and growing the Denver market and just take for instance Amazon. We all know Amazon is going to have their second headquarters domiciled somewhere and Denver is one of the you know top markets that they’re looking at, which brings in about 50000 new employees into the Denver area. So what happens with all of this explosion is we are left with a bunch of people here that are looking to purchase homes but are coming across, you know, with all this expansion in our market it’s just driving home prices up tremendously. So there are people out there that do want to purchase but just don’t know what they, you know, where are the houses that I can afford? Is there any affordable housing out there? So we want to know, are there any viable alternatives to this? So my name is Cheri Landin, the Community Development Director with The Mortgage Company. The Mortgage Company, we are a local lender, been in the area for 21 years servicing exclusively the residential buyer, whether we do all mortgage transactions for refinancing purchasing and purchasing here is a really hot market. So one of the roles that I have as the Community Development Director is to bring education to our residents in the Denver area to just address topics like this that they’re facing day in and day out. So this is a hot topic and I’m joined today with my guests. Her name is Audree Grubesic and she is the owner of Modular Sure Site. So welcome Audree
Audree Grubesic: Thank you, Cheri. I’m happy to be here and I think this is a very interesting topic that is expanding quickly and the Affordable housing market is really something that not just Denver is basically looking at but all other cities. So I appreciate having the opportunity to speak with you and I look forward to a great conversation on affordable housing.
Cheri Landin: Yeah. And so as mentioned here, Modular Sure Site is the name of your company. If you would just tell me what drove you to get into this particular type of housing.
Audree Grubesic: So Modular Sure Site is actually an excavation and site work company. So what I do is I work with a small niche of people that are modular builders. So basically the difference in what we do or what type of homes that we service are homes that are made in a factory. The nice thing about affordable homes and that segment is basically having this area modular builds that are built in a factory come with a nice price point there. Certainly, there are lots of areas where this type of build is very comparable to a sticks and bricks home. The reason why I started looking at modular is because my background I worked in the industry for about five years in the luxury and custom side. And so I was servicing homes that were about $500,000 to about 1.5 million which again is a great marketplace. It definitely delivers for people at the 1 percent that have additional cash flow to be able to purchase their dream home or build their dream home. But then there’s the segment that was really interesting to me because that’s where I fall which is in the affordable market area. Being able to afford a $300,000 home. The average price in Denver for affordable living right now is almost $500,000. And the crazy thing about that is it’s a very tiny small area, small space. If you can even find it right? So it’s very difficult when looking at this price point for anybody. Anybody that comes in is in their 30’s, their 40’s or 50’s, anyone that’s looking to find an affordable home in this marketplace. It barely exists.
Cheri Landin: Yeah absolutely. OK, so and I think so just putting it right out there. When someone hears the word modular I think there’s a lot of misconception around that. When someone hears modular they equate it to manufactured, they equate it to you know what really is a modular home? So I think we’re going to just kind of get into that in a little bit more detail but, you know, the truth of the matter is, you know, like you’re talking about, if you can have a quality built home and pay an affordable price why wouldn’t you regardless right? Save some money and do other things and then. Alright so well let’s just start with the basics. So number one, what is a modular home.
Audree Grubesic: A modular home is a home that actually is designed and built in a factory. If you go to an individual or a builder, as I call them, and you figure out what floor plan you want, you can actually design a modular home with any type of floor plan. It’s not a mobile home. A mobile home and a modular home are different because they are built with different building codes. So a modular home is built at an IRC code, international residential code. This is the same thing that a sticks and bricks home is built with. It’s a building code designed by the state and they have certain permits and codes to the regulation of how the house is built. It’s the exact same thing. The difference is a modular home is built in a factory and shipped to your location and a sticks and bricks house is built on your land and designed the same way.
Cheri Landin: OK. Interesting yeah. That’s you know that is completely different. But I just know in talking with people and you say the word modular, their mind goes to manufactured for whatever reason. Absolutely.
Audree Grubesic: And the interesting thing about that is that people that are in this business know that. So now they’re changing the name to system build which I think it makes it a little bit more appetizing for people to work with. Again I’m a big component of it because one, it’s made in a factory which means that they are constantly under scrutiny of being able to build a house to a certain code and permit and watched. The environment, there are no environmental factors. You don’t have people coming to the job site may be getting there or maybe not. There’s a huge trade shortage in Denver. So a lot of the builders are sharing different trades and having people come to those houses and they’re waiting months for months to get done. Just because we don’t have enough workers to complete the work, so we have that efficiency. You know the efficiency of the product itself that’s built in the factory. They have a lot of green products that are put into the homes. Plus there’s about 20 to 30 percent more material put in these homes because they do travel. They travel from Santa Fe or Albuquerque New Mexico or Nebraska or Utah. So in that whole design and shipping the home on a truck, it has to have, you know, great structural design and engineering to make sure that the product can get delivered.
Cheri Landin: OK so that’s interesting. So you know it’s not only, it sounds to me like it’s not only just a price point that might be attracting buyers to this particular product now. It really is, you said, these efficiencies and a lot of flexibility is what it sounds like too.
Audree Grubesic: Yeah and I think that’s the education part about modular. Any type of design plan can then be designed as a modular home. You can have any floor plan that you find anywhere on the Internet or you work with an architect and that plan can get sent to the factory. They would redline it. They would put together a strategy of how it’s going to get built and you would have it done the exact same way you would if you were going to have it on your land and built.
Cheri Landin: All right. So let’s let’s talk about, so from an efficiency standpoint too it sounds like what if someone wanted to build a modular home or have a modular home built for them. What kind of timeline are we looking at?
Audree Grubesic: The first thing is, you know, being in the mortgage industry you know there are several pieces to the puzzle of building a new home and this is still the same new home process whether you look at it you know ordering it from the factory or again having it built on site. So the first thing is finding land. So you have to find your lot. You have to find out where you want to live. You have to look at the community, have to look at all of those particular pieces and so you find your land. The next process is designing your home. So you kind of figure out a floor plan and the nice thing about modular is actually you pick every single thing that’s in your home and it’s actually completed in the home and shipped from the factory. So you’re not on site picking tile and putting stuff in there, later on, it’s completely done at the factory and shipped. So the price points vary because it all depends on the selections that you’re putting in your home just like any other home your price point can be anywhere from $60 a square foot to $150 a square foot to $250 a square foot. You know I was talking to an architect the other day and he was telling me that he was looking at both designs from a standpoint of doing it in the factory or doing it at the location itself and the client only had six months to get this done. And so for him, it was a great solution because from beginning to end after he had his plan, they ordered the product, it got built in the factory and then it got shipped in altogether the total amount of time was about six months.
Cheri Landin: Oh wow. Well and so I mean if you think about it. Well, let’s talk about our Denver weather for a minute. You know 80 degrees one day and snow the next. There’s a lot, there could potentially be a lot of downtime in the quote traditional building process where when it’s modulars in the factory it can be snowing outside and they can still be working on your house.
Audree Grubesic: Absolutely. I think the only difference, you know, people keep asking me as I educate them through this process. You know the one thing that you do have to be concerned with are logistics. So if you’re building in an infill lot in Denver you have to close down streets sometime you have to figure out how that all works. It’s not impossible, it’s been done. A lot of my clients are in outlying areas other than the metro Denver area only because infill lots are completely overpriced right now. So finding an infill which is about 6250 square feet which is very tiny too then going out to Castle Rock or Parker or Weld County or Adams County where you can buy two acres for you know a 1/3 or 1/16th of the costs. So people are now getting driven by not only price but also by being able to have a place that they can have some land.
Cheri Landin: Absolutely right. And so and and back to that so that is one of the things. This is a build process so you do need land.
Audree Grubesic: Yeah absolutely. And same thing for you I mean on the mortgage and even banks and the lending side. A lot of banks, many banks that I have talked to really love this product. Why do they love it? It’s a fixed cost. They know exactly how much they’re going to be spending out the door when the house gets ordered to when it gets shipped to the property they know exactly how long the time frame is going to be for the schedule. I mean typically first site work on my end, I’m looking at a possible two month planning period and four to five weeks of total time of being able to put the house on the property, on the foundation, tying it up, you know looking at the electric, the gas, and the utilities and getting those hookup up to the tap fees and then basically it’s just finishing the house, the driveway, the garage. All those particulars. It’s a very short amount of time, which is great because someone that gets their house put on a lot, you could be, it could be sitting there for about six months. This you’re looking between you know three to four or five weeks and you’re in your home.
Cheri Landin: Wow. Big difference. Yeah. That’s awesome. And I think you mentioned, could this maybe if a lot of people did modular, could this improve our traffic because we wouldn’t have so many shut down streets. Right. I mean how long does it take. They’re going to they bring this home this completed home on the truck or flatbed you know whatever the apparatus is that they transport and set it up.
Audree Grubesic: Yeah it’s literally that same day.
Cheri Landin: Wow. Yes so. So you don’t have the construction crew for months and months blocking the roads.
Audree Grubesic: No you don’t. I mean really you know the same time that you’re designing your house and figuring your budget and getting that all completed is the same time that you can also start your site work. You can start your foundation, you can start your excavation, you could start doing your soil’s report, you can start getting your survey and your plot map complete. It really is an efficient product not only from the price point standard but just the point of time frame to have it completed and done.
Cheri Landin: All right. That’s awesome. All right so. So you work directly with. The builder you are not the builder.
Audree Grubesic: Correct. So in the state of Colorado, there are between, there used to be several years ago I think 24 builders. And when I am talking builders, these are the individuals that actually onsite. They have the homes that they sell for different manufacturers so there’s Heritage Homes, there’s Champion Homes, there’s Ironhorse Homes, there’s Bonnavilla Homes, so there are all these different types of factories that carry their own brand and their own design. But the interesting thing is the way that this market has transformed a lot of these manufacturers are now looking at custom modulars they’re doing designs from plans that people bring in. So you know it depends on where you’re looking to live. So for me, I’ve met most of the builders in the state of Colorado each one of them has a different product and something that they specialize, that they bring to the table. And you know location is a big key to that. Now you know there’s a guy in the south that builds homes and in the south of Colorado, that’s kind of the marketplace he wants to stay and he’s busy enough. There’s a guy in the mountains, you know mountain town. He’s doing a lot of second homes for families that are coming in from California and Texas in other areas outside of Colorado to have a mountain home.
Cheri Landin: Right. Well, it’s interesting too. So clearly this is I think could be just a tremendous product for people to really get a home that they love and can customize at a decent price. But we were talking with a gentleman the other day who just designed the home and had it built in a modular fashion in Cherry Hills village. It was a 10,000 square foot home built through modular products.
Audree Grubesic: Absolutely and I think that was just so telling because this product isn’t anything new. They’ve been doing this since like the 1950s I think even like the early 1900s houses used to come in pieces and you used to put it together, you know that’s kind of how the product has worked. The East Coast and West Coast. This is all they do. Europe, all they built is modular. Australia, all they do is modular. So it’s just one of those points of education in letting people know that there is another opportunity out there. I’m not saying it is the end all be all for everyone. There is a product base for every person in the housing market, just for me and the things that I’ve seen in my background, I really love their product because I love that you can one buy a home at a certain price point and actually have it delivered and now you’re working with a brand new product, a brand new home instead of buying something for $500,000 and still putting more money in it so that you can get it up to code. Or you can actually have a basement finish, you’re putting even more money into a home that you’re already maxed out at your budget as it is. So it’s nice to have another option I guess that’s kind of where I’m coming from.
Cheri Landin: Right exactly. All right so. And I do too, I hear you know all the time, there are buyers out there they just can’t find homes or they find a home and it’s not exactly what they want. So this could be a good alternative and I think that because the modular build has had so much talk about it lately there’s a lot of curiosity with it. So let’s say that there are people out there listening right now and they’re thinking you know what, I kind of, I’m I am interested a little bit in this. And you know honestly I think another stereotype of just an overwhelming process is people just in general a building a home like, oh my god it’s going to take forever, I’m going to go over budget, it’s going to be exhausting. I can’t make all these choices right? And I just don’t have the time. So this is really it. Let’s say there is someone out there that says, you know, I really want to find out more about this. What do they actually do? So I know number one they have, maybe there’s someone out there right now that’s been sitting on a piece of land right. They’ve been sitting on a piece of land they haven’t built anything because the cost has been too great to just have a builder come out there and do whatever it is that they do. So they’re just kind of at a standstill right. So let’s say there’s someone out there either with a piece of land or looking to purchase a piece of land. Who do they talk to first? What’s next.
Audree Grubesic: I think the very first thing just with any big financial investment, in building a home is a huge financial investment, is really talking to your bank and really figuring out your financial worth and where that budget lies. Right. Because really the budget dictates what type of size home, where you’re going to get financing. You know just being educated. Just in your realm with The Mortgage Company, the nice thing is you guys actually bring people through understanding about credit and understanding about the process and understanding what you can afford and maybe things that you can’t. So I think it comes down to budget right. Educating them on budget. The second thing is put in modular or put system build into a Google search and just start looking at it. You can always contact me at modularsuresite.com. I’d be happy to walk you through the process but it is still a process. The nice thing about modular though is that you’re making all those selections and it’s completely done by the time it gets to your house so you’re not sitting there going to all the design centers, not saying there’s anything wrong with it. Again there’s a marketplace for that. The nice thing though is that it keeps you within a budget. When you go into those builders and you meet those individuals about your specific plan they’re very budget conscious. They know exactly how much to stay within where you’re looking, what manufacturers are a good option for you. So I think it’s just asking a lot of questions and try to do some preliminary research online.
Cheri Landin: Right. And from a financing perspective, modular homes are able to be financed in any of the traditional ways, whether it’s conventional, you know the government programs, FHA, VA because they are an actual home. And I think really the biggest differentiators like honestly is it built in a factory versus built on site based on everything that you just explained so you know there are restrictions on manufactured homes, there are restrictions on mobile homes but this is an absolutely fixed home to your foundation and that, of course, is what you were saying.
Audree Grubesic: You’re absolutely right, it’s appraised for the same thing. It’s built the exact same way. They’re both permanent and IRC code, they’re both financed. You can have your modular home be appraised for the one that’s building right next door to you that may not be modular so they appraise for the exact same value. Right. But when you’re talking manufactured or you’re talking mobile now you’re talking different types of loan and loan products. It’s a different process. They appraise differently right.
Cheri Landin: No I know. I mean I know it’s a lot of information but yet at the same time, I really think it’s just understanding that there typically, I mean I don’t know today. So we’re talking about modular new builds. Is there a market out there right now for you know, are there modular homes out there on the resale?
Audree Grubesic: I would say yes I know that they are out there I just don’t know a lot of people that are leaving their homes right now. You know I just had a dinner with a couple of agents and both in real estate. People aren’t leaving their homes because where are they going to live. Right? So absolutely I think that there is a marketplace out there. I know that there are homes that are modular. I know that they already preexist. I just think that the reason why there’s a conversation going on right now is because we’re trying to find another avenue to fulfill affordable or as I call employed housing.
Cheri Landin: Yeah exactly. Which is right. All right. So I think that for people interested you know kind of like Audree said absolutely do your homework. I mean we have this wonderful resource right the World Wide Web. We can google just about anything and get some information on it. It’s a great place to get some education on it. But Audree is an absolutely fabulous resource. Audree if you can give your contact information.
Audree Grubesic: Yeah. By all means, e-mail is always best so you can go to firstname.lastname@example.org. You can always find me online. You can also look for me on Facebook I put a lot of great content on Facebook. I have a Twitter handle as well. Modular Sure Site. I also have a Linkedin page, so if any of you are social media savvy you can find me in all those different areas. Feel free to ask me questions. I can give you some great direction. I love this product. I’m actually looking for land myself and looking to build modular in the next six months.
Cheri Landin: That’s awesome. And to you know for all of you out there that this is a consideration to make sure that you do talk to the lender first make sure you are pre-approved, know what your price point is so that when it is time to get out there and start your build, we know exactly what the budget is and we of course can be reached at themortgageco.com. And a lot of resources there. And this is where you’ll find our podcast I’m guessing, if people are listening to our podcast right now they are savvy like on social media. This is the way. We know we need to do this, just connect. Just like us and connect. Alright. Well Audree this has been fabulous. Is there any closing comments that you’d like to add? You know any takeaways that is, if you need to know one thing, this is kind of a thing.
Audree Grubesic: Keep an open mind you know I think that new builds, it’s always stressful and building you’re never going to get away from that. But keep an open mind. This might be an opportunity where at one time you didn’t think that you could build a home for maybe $200,000 or you didn’t think that there was an opportunity that you would ever get out of the rental market. Right. This definitely feeds that. And it’s it’s all about information it’s it’s learning the process. It’s finding that type of work out there that actually puts a product out there that actually looks beautiful and that’s kind of the nice thing too there’s a lot of dealers and a lot of manufacturers and builders out there you would walk across the street and never know that that’s a modular home.
Cheri Landin: Oh absolutely. I’ve been seeing it. It’s really you know since we’ve been having conversations about this and I’ve been learning more about it I am absolutely stunned.
Audree Grubesic: Just if the modular word scares you or makes you nervous, just call it system build and you’re all set and you’re ready to go
Cheri Landin: That’s awesome. Alright. Well I really appreciate your time and thank you for joining me.
Audree Grubesic: Alright Cheri, thank you I appreciate it.
Cheri Landin: Alright!
About Audree Grubesic
Audree’s background started in Chicago, as a television engineer for CBS-WBBM TV and then to ABC-WLS TV. She has always been interested in technology, behind the scenes of broadcast news, speaking about life events and connecting with real people. From television she moved onto radio sales, direct response marketing and sales. 16 years ago, she relocated to Colorado Springs, CO. While in the Springs, she created, developed and designed a publishing company called PETacular. It was the brainchild of Audree Grubesic and Kelly Nesbit. The goal was to connect people and pets through statewide pet directories, quarterly publications, Yappy Hours and pet expos. After 11 years of building PETacular the business, it was sold to the Colorado Springs Gazette. Through sales and marketing she met several builders and discovered a love for the building industry. She became a quick study of luxury home builds as the director of sales and marketing for two prominent custom home builders. She and her family moved to Denver, CO in 2016. Because of the high cost of living in Denver, affordable living was her quest. “Everyone should be able to afford a home they love. A home is the foundation for living and connecting.” Modular Sure Site was created to assist builders and clients to understanding the build process, have a well designed foundation and site work for their home place. Our goal is to have our homeowners feel a sense of accomplishment moving into their brand new affordable custom home.
NMLS #: 984868