Business Idea

Start A Home Building Company

About

Starting a home building company requires a great deal of effort, dedication, and most importantly passion.

If you're interested in how to sell home construction, or selling home construction online, you can use this page as a guide for everything you'll need to know.

Want to learn more? You can check out our full guide on how to start a home building company ➜

Key stats

market size
$97.5B
revenue (monthly)
$500K
starting costs
$207K
gross margin
20%
avg product price
$428000
time to build
12 months
growth
Word of mouth
business model
Consulting
time investment
Full time

About

Starting a home building company requires a great deal of effort, dedication, and most importantly passion.

If you're interested in how to sell home construction, or selling home construction online, you can use this page as a guide for everything you'll need to know.

Want to learn more? You can check out our full guide on how to start a home building company ➜

Key stats

market size
$97.5B
revenue (monthly)
$500K
starting costs
$207K
gross margin
20%
avg product price
$428000

 

time to build
12 months
growth
Word of mouth
business model
Consulting
time investment
Full time

Startup Costs

Min Startup Costs Max Startup Costs
Office Space Expenses $40 $2,350
Employee & Freelancer Expenses $0 $5,500
Equipment & Supply Expenses $550 $6,000
Website Costs $232 $6,500
Business Formation Fees $5,600 $20,400
Inventory Expenses $300 $5,000
Vehicle Expenses $50 $10,500
Other Expenses $0 $2,300
Software Expenses $162 $3,094
Advertising & Marketing Costs $75 $5,286
Total Startup Costs $7,009 $66,930

Successful Businesses

Business URL Rank
Builders South Africa builders.co.za #16,415
Toll Brothers tollbrothers.com #24,571
Lennar lennar.com #25,543
House Plans houseplans.com #47,417
Fine Homebuilding finehomebuilding.com #49,773
Dr Horton drhorton.com #51,960
Tiny Home Builders tinyhomebuilders.com #57,649
Pulte Cares pulte.com #58,544
The House Designers thehousedesigners.com #68,668
Prestige Constructions prestigeconstructions.com #70,627
Habitat for Humanity habitat.org #72,683

Pros & Cons

Pros Description
Flexibility You can put as much time into the business as you'd like. If you like the work and have some initial experience, you can start small and manage all aspects of the business on your own.
Meaningful business connections You never know who you will meet as a home building company. This could be the start of an incredible business opportunity!
High customer retention rates Once a customer invests in your product, they've invested their time and energy to utilize your product/service which is highly valuable to them. Typically, your product or service becomes indispensable to your customer.
Pick & choose the clients you work with Home Building Companyes have the ability to choose the clients they work with. You have the freedom to work with only a few loyal clients or with hundreds of clients!
Control of workload With starting a home building company, you have the unique ability to choose how little or how much you want to work. You also have the freedom to decide which projects you want to work on, and can turn down the ones that do not interest you.
Gain exposure and experience This career allows you to gain experience working for multiple different businesses - which will benefit your resume and also keep things interesting for you!
Cons Description
Motivation of employees If you plan to have a sales/content team on board, finding creative ways to motivate them can be a challenge. It's important that you're able to offer great incentives and a good work environment for your employees.
Longer Sales Process A home building company can be a big time and money investment for your customer, so it's important you plan and predict a longer conversion funnel and stay in communication with potential customers.
Low margins The gross margins for your home building company are typically around 20%, which can make it more challenging to incur new expenses and maintain profitability.
High employee turnover In the home building company, employee turnover is often high, which can be quite costly and time consuming for your business. It's important to try and avoid this as much as possible by offering competitive pay, benefits, and a positive work environment.
Taxes As a home building company, you typically pay self-employment taxes which can be quite high. It's important to understand what you will be paying in taxes each year so you can determine if the work you're taking on is worth it.
Stressful work This line of work can be stressful for both you and your clients. This type of transaction is a significant financial decision for your client, so expectations are very high for you. Although this career path can be very rewarding, it also comes with its challenges and stressful moments.

Marketing Ideas

  • 1

    Affiliate program

    Affiliate marketing is a great way to bring in a new revenue stream, especially when you don't sell products or services.

    Simply put, an affiliate program is an agreement where a business pays another business or influencer ("the affiliate") a commission for sending traffic and/or sales their way.

    The affiliate typically gets a unique link where clicks and conversions can be tracked.

  • 2

    Direct sales

    You may find yourself in a spot where you're ready to hire a few (or many) salespeople to support the sales conversion process.

    Regardless if you have one or thirty salespeople, it's critical that you assign them specific roles and responsibilities to nurture the client and provide excellent support.

  • 3

    Word of mouth

    Word of mouth is when a consumers reflects their interest in a company’s product or service in their daily dialogues.

    Therefore, word of mouth advertising is essentially a free advertising triggered by the customers experience.

    According to Nielsen, 92% of people trust recommendations from friends and family.

    Therefore, in today’s hyper-connected world, a single recommendation through a word of mouth can have a huge impact to your business.