CEO, Fulton Homes
How would you assess the current state of the home building industry?
Today, I would say it’s in recovery. I would definitely say we have hit the bottom and we are experiencing the trough here. … From this point, things can only get better … This is our fourth year (dealing with the downturn). It’s a very, very tough cycle. This is a cyclical business, it always has been. I was here in the ’80s and ’90s when it cycled then, with the Keating, Lincoln Savings (& Loan) RTC days. It cycles. This one has been a vicious, tough, tough cycle where we’re paying for the run-up and the escalation — and the runaway inflation in the homebuilding industry is really what we had. Now, we’re paying for it.
Foreclosures are expected to be higher in 2010 than they were in 2009. How will that affect the home building industry?
Luckily, the banks aren’t fire-selling these properties, which is a good thing in two ways. One, is that it’s keeping the values somewhat stable, not letting them fall through the floor. And second, it’s very frustrating for people to buy a foreclosed home or a home that is in the short-sale mode. It takes a lot of time, it takes a lot of energy, so I have an entire group out there that is very frustrated about the whole process. And guess what? I can give you an answer (on buying a new home) in 24 hours.
What strategies has Fulton developed to cope with the collapse of the housing market?
We have targeted foreclosures — that’s what we’ve done. We’ve gone after them, talked about them, we do the little tongue-in-cheek “lipstick on a pig equals foreclosure.” We have the foreclosure-cost calculator. … You can actually go onto our website … and you can punch in cabinets, countertops, flooring, paint … and it shows what you are really going to pay for this (foreclosed) house when it is all said and done and you have it all fixed up to the level where you want to live in this thing. And then there is a button off to the side of that … that goes out to our quick delivery inventory homes and finds homes $5,000 up or down of what you’re going to pay for a home that you are basically (going to have to renovate). … That’s how we’re combating the current market status.
What lessons can the home building industry take away from the economic downturn?
First and foremost, it’s a cyclical business. It always has been and it always will be. Some are going to be tougher than others. This has been the toughest one in over 30 years that I’ve experienced. Going back to quality construction, treating your people with respect. … When times get tough, people want a safe harbor. … Consumer confidence is at all time, historical lows, so if they are going to make that decision (to buy a home), they are going to go to somebody they feel comfortable with, someone they know, that their neighbors brag about — word of mouth. Obviously, word of mouth is an important way to advertise. We earn that by delivering a quality product and treating our customers (well).
What is the role of a C-level executive working in the home building industry today?
I have lots of hats. We don’t have anyone here with executive-itis. … We don’t have anyone here with their mahogany playpen at the end of the hall barking out orders to secretaries. There’s never been a secretary at Fulton Homes and there never will be. Never happen. If your garbage is full — empty it. If you want a cup of coffee — the break room is over there. We are very hands-on. So when you say “the role,” I don’t even know where to begin. I don’t do it all, not even close. I don’t want to give that impression. I hire people that I don’t have to go around wiping their nose. … I make it very clear to everyone that this is where we’re going, get them to buy into it, to understand it, and treat them with respect.
- Vital Stats
- Joined Fulton Homes in 1981
- Served as vice president of marketing and president at the company
- Attended Pierce College, Utah State University and Arizona State University
- Is a special deputy with the Maricopa County Sheriff’s Office, a member of the Central Arizona Mountain Rescue Association and an honorary commander at Luke Air Force Base