Hurricanes, wildfires and other natural calamities are a homeowner’s worst nightmare, and forward-thinking homebuilders are doing something about it. As housing demands rise, the need for homes that are resilient, energy-efficient and sustainable has never been more critical.
But can those three goals be achieved without sacrificing affordability? That was the main question addressed March 8 in a panel discussion at the SXSW Conference in Austin, Texas, entitled “Future-Proof Housing for the Next Generation.”
Moderated by Danielle Hale, chief economist at Realtor.com®, panelists included Jared Kon, VP of real estate and land development sales at ICON Homes, an Austin, Texas-based home-design company utilizing robotic construction, and John Ho, CEO of Landsea Homes, a homebuilding firm based in Dallas, Texas.
Emphasis was on the importance of using technology, such as 3D printing and home automation, to enhance energy efficiency, durability and overall living experience. The conversation also highlighted the challenges posed by outdated building codes, labor shortages and regulatory impacts on housing affordability. Both panelists expressed optimism about the future, driven by technological advancements and a new generation of builders and developers.
Kon, a former apartment developer, is pushing for a change in how homes are rebuilt after disasters, rather than just rebuilding the same way.
“Look at what’s gone on in the last two years,” he said. “We’ve got (part of) Hawaii burned down, Florida blew away, North Carolina blew away, and now LA. So we have to focus, as a country and a world, on building structures that are going to remain after these natural disasters.
“Today, sadly, we continue to build back the same way. I’m in LA trying to figure all this out with them, and they want to rebuild the same exact way. At ICON, we’re pushing them and trying to get as many groups as we can to say, ‘let’s try to think about this differently.’”
Ho noted that today’s new homes have it all over older ones.
“There is a clear advantage when it comes to new housing versus existing housing,” he said. “When you build a new home, you’re building it to code on a lot of things. Coming from California, a lot of the regulations have sprinkler systems, homes that are net zero energy ready, and (we’re) required to put solar on our homes. There are a lot of things that sometimes can be too much, but there are definitely a lot of advantages to building to the new code. A lot of existing homes have been grandfathered in. They were built at a time when there probably weren’t the kind of drastic changes in the climate that we’ve had in certain regions.”
Hale next asked whether homebuyers today were asking more questions about protecting a property than maybe others had in the past.
“If they’re not in a hurricane zone, they’re not worried about it,” said Kon. “But these fires really made a huge impact. Another one that’s really interesting is that I’ve had people talking about mold. I’ve had people tell me they had really bad medical experiences. When they found out our homes are mold-resistant, they didn’t know that was even possible. So it’s more than just the wildfires and other national disasters. Certainly the conversation is changing.”
Energy usage and climate change have also been hot topics when it comes to new-home construction, according to Ho.
“We have done a lot of surveys of homebuyers and what they really care about, and energy-efficiency is always top of mind,” he said. “We build primarily entry-level homes, so affordability is really important. Energy-efficiency helps lower the cost of homeownership. People don’t always think about that at the beginning, but when they own a home, it really starts to hit them if they’re in climates where we build. In Phoenix, you run air conditioning 24/7. When you build homes that have better insulated, tighter building envelopes, it reduces the amount of energy you need to cool that home.
“The other thing that’s really top of mind now is water efficiency. There’s a lot of great technology out there now for water efficiency—whether it’s in the master plans that we use for irrigation and recycling, whether it’s just smarter ways to manage their own irrigation and the landscaping of homes—so we’re trying to incorporate that into what we believe is a whole home system smart home environment.”
Hale wondered if technology is playing a more prominent role. “So for builders,” she asked, “are there best practices they can use to speed up construction and future-proof housing?”
Kon answered by pointing out one segment of the market that requires more technology: seniors.
“We’re seeing a lot of interest from seniors, and you think about the baby boomer—the whole age group—it’s so large, and a lot of them don’t want to move into senior housing,” he said. “There’s more in-home care now, and technology is going to enable that even more in the future. And they really love energy-efficiency. They’re on a fixed income, they want to know what their utility bills are, and we offer a really energy-efficient home as well. So it’s a wide range, not just the new homebuyers.”
Hale wrapped up the session by seeking opinions on what’s next to come.
“How will future-proof housing be affected by the new administration, and how does the interaction between using technology to get to where we want to go versus using people, what’s the tradeoff there—and what do you see in the future with regulation or with other legislative policies?”
“The thing right now is that we’re starting to see deregulation,” said Kon. “And it’s a little double-edged sword. There was an energy-efficiency requirement put in by the previous administration that made it mandatory to put very efficient systems in the home. And that’s good, but it added a $20,000 to $30,000 cost to every home built. You need to do it, but maybe let the homebuilders decide, or incentivize them to do it in a way so the consumer doesn’t feel the end price.
“And they’re going to allow more deforestation in America to get lumber going. It’s not great. We all love forests, but the reality is that lumber prices could rocket. We get the majority of our lumber out of Mexico and Canada, and there are high tariffs coming. If lumber prices spike back to where they were in Covid, $2,000 per linear foot, it’s going to be a problem. Homes are going to stop being built, apartments are going to stop being built. We’re going to have to find other solutions. Then there’s steel tariffs, and we use metal reinforcement in our walls. So it’s a scary time with the tariffs.”
Ho said it would be helpful if interest rates were lower.
“There are things the federal government can do,” he said. “Top of mind is interest rates. Some stabilization would be helpful. Interest rates hit us from both sides. It hits our cost of capital—it’s more expensive than ever for us to borrow money to build homes—and it hits because most homebuyers, particularly in entry-level, need a 30-year fixed mortgage. So the mortgage rate is really important.”
