In “The Dog and Its Reflection,” an Aesop fable, a dog carrying a sumptuous bone is looking for a safe place to eat it. While crossing a bridge over a stream, he looks down and sees his reflection, but takes it for a rival dog. He jumps at the intruder and loses the bone in the water.
We can all be fooled by appearances, something to keep in mind while looking for your town on our Top 100 Markets list. What you find may not mean what you think it does.
For one thing, each metropolitan statistical area, or MSA, is huge. For example, my MSA includes Washington, D.C., plus parts of Maryland, Virginia, and West Virginia. Income, home values, employment, and other factors differ significantly over an area that large.
Also remember that the ranking compares a city’s current and forecast performance to its performance in 2007, the year that remodeling activity peaked. But the unevenness of that activity makes all the difference. Unless houses have stopped aging, roofs have stopped leaking, and families have stopped growing, there will be remodeling activity in your community. The trick is figuring out where.
In the past, referrals took care of this because most people move in a circle of people like themselves. Socioeconomic status may not be an exact match, but there are usually more similarities than differences. Referrals from your best customers were a kind of target marketing and they still work today, but the pickings are slimmer. That doesn’t mean that no one’s remodeling, but it does mean that they will be more difficult to find. And they aren’t going to come to you — you’re going to have to go out and find them.
Our recent housing research shows that the best place to look is … yes, it’s still the baby boomers. Their homes are still important to them, and a large number of them don’t want to sell and move, they want to stay put; the rest are thinking twice about selling because they can’t get the price they want. Lots of boomers have changed or postponed their retirement plans, and they now realize they’re going to be spending more time in their existing home.
The best potential customers are those who match a customer profile that you develop by organizing past projects by type of owner, type of project, amount spent, age of home, profit made, and other factors you deem significant. Take a guess at client income based on their occupation, home values in their neighborhood, the car they drive, and other telltale factors.
The more you know, the better able you will be to find clients whose needs and means match those of your best past clients. And you will also gain from knowing enough about your ideal customer to stop pursuing work that leads to nowhere.
Spring is right around the corner. Time to get started!