Don’t miss this popular 2 hour seminar taught by Scott Rodwin and Jim Kadlecek through the Boulder & Longmont Area Realtors Assoc. (BOLO). Want to know what you are allowed to do with a property? We answer the common questions: “How big can I build?”, “Can I build here?” “How much does it cost?” and a hundred more of the most frequently asked property owner/buyer questions. Includes new Marshall Fire rebuilding info. This information-packed webinar includes an overview of Historic Landmark designation, floodplain, the latest green building codes, the Compatible Development Ordinance, and the County Site Plan Review process. Boulder has some of the strictest and most complex regulations in the Country. Come get informed (and if you’re a BOLO member, it’s free and you get 2 Continuing Ed credits). $40 for non-members. This workshop often sells out so reserve your spot today. Register here.
Why is home construction so expensive, and will it stay that way?
Beginning in 2010, Boulder construction prices have risen about 10% year-over-year… until the arrival of the pandemic. For a hot second in April 2020 no one was building or buying anything; then starting that May, it seemed like everyone in the country decided to move to Boulder County. Since then, local construction prices have risen an unbelievable ~60%. It’s an unprecedented increase that has paralleled the rise in real estate costs in general. The cost of construction is shocking and frustrating to nearly everyone who is trying to create their dream home here.
Every conversation we have with a new client starts with the question of, “how much will it cost to build our new home?” An accurate answer is a bit complicated, but for a quick rule of thumb the figure $500-800/sf. is a reasonable place to start (apply that figure to all square footage including unfinished spaces like garages and basements). And while it is easy to exceed that range, it is extremely difficult to go below it. Here are the main reasons it’s so expensive:
Labor shortage
The single clearest reason is that the region’s decade long building boom has resulted in an intense, state-wide and chronic shortage of skilled labor. Every plumber, framer and electrician is able to command premium prices as their services are simply in high demand right now. The Great Recession devastated the construction industry and forced roughly 50% skilled contractors to permanently leave the field. Additionally, as the price of housing has increased in Boulder, more and more of the folks who design and build our homes have had to drive from further and further away, which increases costs. Lastly, the contractors’ cost of doing business has increased dramatically as well – from salaries, to gas & vehicles, to the cost of everything they buy.
Supply-chain related material cost increases
The price of a 2x4 has never been a front-page story. Until COVID. Suddenly everyone knew that lumber futures rose 400% in a single year. While that one category has come down dramatically in the last several months, it’s still well above historic norms, and other high-fliers like steel are still in the stratosphere and are going up and up. Most building materials had a less dramatic increase over the last 2-1/2 years (generally 15-100%), but still unprecedentedly large.
Building codes
The rigor of Building Codes generally increases every year. Structural, mechanical, electrical, green building and life-safety codes are constantly being updated, and with each revision, it becomes more expensive to meet their requirements. For example, in Boulder County ALL construction must now be ignition (fire)-resistant and all new homes must have a fire suppression (sprinkler) system. You do get a better, safer home, but it costs more. Note that the Boulder City and County areas also have more stringent codes than surrounding municipalities, so the cost of construction here is correspondingly higher.
Low quality, aging building stock
The cost of construction is affected by how much we need to change. The majority of our existing building stock was built between 1950-1985, which was a low point for quality in the history of residential building. So, every year, as these generally poorly designed & built homes age, the delta between them and a new code-compliant home gets larger and larger. The more we need to change, the more expensive the work.
Only high-end, custom single family homes allowed here
You know and understand that the constrained supply of housing accelerates the price increases. However, unpacking the issue a little further, note in most other areas of the country when there is a demand for less expensive housing, the market has the ability to respond. Other than a handful of Affordable Housing units, in the City and unincorporated Boulder County we don’t have that ability. There are no large subdivisions being built here, and the economy of scale of those subdivisions dramatically reduces their cost/sf. of construction. Additionally, due to a combination of state construction defect laws and anti-density rules and politics, we have very few local condo projects in the City & County – another staple of lower cost housing. Since we have locally eliminated the two main types of entry-level housing, it means that nearly all housing is forced to be the most expensive kind – single-family custom homes. And due to the high-land costs and banking rules for the value ratio of land-to-improvements, nearly all of these single-family homes are in the upper end; it’s not economically feasible to buy a $900K lot and put a $500K house on it. The story is different in Longmont, Erie, Westminster and some of the other surrounding towns that have more land and less restrictive zoning rules. This has kept the price of housing more reasonable in those areas.
Great Expectations
Homeowners have higher standards today than they did previously. A decade ago, if someone came to us wanting a “starter custom home” we might suggest plastic laminate countertops and vinyl windows. Nowadays, their expectations start at low-end granite and wood/aluminum clad windows. The price delta between vinyl and wood windows is ~5x. This shift in expectations is true in every category of construction. Additionally, the geometry of a house has a large impact on its cost; a simple box with a gable roof and small windows is inexpensive to build, but most clients desire a more complex and extraordinary form, again seeking to match a quality level commensurate with the land cost. Rising buyer quality expectations are actually responsible for some of the largest cost increases over the last decade.
Fixed & Soft costs
The requirements for Fixed and soft costs have been rising (especially in Boulder). This includes the cost of permits, utility connections; water fees, and site improvements (like landscape and sidewalks). Additionally, the amount of required documentation and testing for permit and construction has increased every year and this drives up design and engineering fees. Lastly, greater risk requires greater reward, and projects in the Boulder area have much higher likelihood of encountering obstacles than in other cities; therefore developers, builders, landlords and ordinary homeowners look for a higher rate of return on their development projects.
External Financial Forces
Lastly, between mortgage rates that jumped from 3% to over 7% in just two years, and the downturn in the crypto and stock market, many buyers’ buying power took an enormous hit.
The Cost of time
Between labor shortages, material supply chain delays and the sudden need to rebuild 1000 homes lost in the Marshall Fire, it takes much longer to build or remodel now than it did pre-pandemic. From the time someone contacts an architect and secures their land, it used to take ~two years to move into a custom home. Now it’s ~three. The 50% increase in time costs proportionally more money for things like salaries of Site Supervisors, rental of porta-johns, and the duration of a Builder’s Risk insurance policy.
What about Marshall Fire re-construction costs?
Many people have asked us, given everything we’ve listed in this article, how can we solve the tragic dilemma of the enormous gap between what insurance companies are willing to pay for rebuilding, and what it actually costs? There are lots of ways people are working on this conundrum: grants from the Community Foundation and the state; generous Energy Star and Passive House rebates from Xcel; probono services, donations and discounts from local businesses, architects, builders and material vendors; exemptions from some building code updates; and creative delivery methods like manufactured housing, or banding together with their neighbors to allow production homebuilders to bring an economy of scale to the endeavor. There is no silver bullet to solve the whole problem, but all these concerted community efforts have helped to mitigate some of the worst impacts of financial gap.
See a list at: https://cgbg.org/resources & https://rebuildingbetter.org/chapter-three/
Crystal Ball – what’s next?
Cumulatively, all of these forces have been working together to dramatically drive up the cost of housing at a record pace over the last few years. Despite the talk of a possible Recession nationally, the local custom home market has such a pent-up demand that it has so far remained fairly insulated from the housing downturn that is now materializing elsewhere in the country. Nationally, despite the US being short about 4 million housing units, current predictions anticipate a fairly substantial retraction in housing prices, and a corresponding reduction in housing construction starts. The latter will likely put a damper on the cost of construction products like lumber and appliances everywhere, including Boulder County. However, until we experience a local slow-down in construction demand (which is unlikely for several years due to the Marshall Fire rebuilding), coupled with a strong international revitalization of the supply chain, I anticipate that while there might be a leveling off of construction costs, there won’t be a reduction in the foreseeable future.
'Creating the Empyrean Temple' - a talk by the temple architect, Renzo Verbeck
We’re organizing a super cool event. Come check it out!
Creating Burning Man's Empyrean Temple - a talk by the Temple's Architect
Sat. Dec. 10th, 7-9pm with reception to follow
Nomad Theatre, 1410 Quince Ave., Boulder, CO
Ticket price $25 https://buytickets.at/artincommunity/809644
Join Boulder architect Laurence Renzo Verbeck for a discussion of how and why he uses architecture to create spaces for meaningful connection, as he delves into his experience designing and building the Empyrean Temple at Burning Man and the Temple of Tranquility for the City of Boulder.
Also learn more about the upcoming Boulder Burner art installation The Temple of Tranquility at https://templeoftranquility.org/ .
What to Know About Adding Outdoor Lighting
Informative article on Houzz about the art of outdoor lighting! Read the whole article here.
Level Unlocked! Boulder Lifestyle November 2022
Great article on one of our most recent projects, Deckhouse in Boulder, in Boulder Lifestyle this month! Read the whole article here..
Houzz Barometer Shows Slowed Business Activity in Q3 2022
The just-released 2022 Q4 Houzz Renovation Barometer provides timely insights into the impact of recent economic volatility on the home renovation market. Professionals across sectors report slower business activity in the third quarter but diverge in their expectations for the fourth quarter. A majority of businesses in the architectural and design services sector anticipate continued growth in Q4, while a majority of those in the construction sector anticipate slowed Q4 activity. Read the whole article here.
Understanding the Rules for Building in Boulder, Sept. 16th, 9:30am-11:30am
Don’t miss this popular 2 hour seminar taught by Scott Rodwin and Jim Kadlecek through the Boulder & Longmont Area Realtors Assoc. (BOLO). Includes new Marshall Fire rebuilding info. Want to know what you are allowed to do with a property? We answer the common questions: “How big can I build?”, “Can I build here?” “How much does it cost?” and a hundred more of the most frequently asked property owner/buyer questions. This information-packed webinar includes an overview of Historic Landmark designation, floodplain, the latest green building codes, the Compatible Development Ordinance, and the County Site Plan Review process. Boulder has some of the strictest and most complex regulations in the Country. Come get informed (and if you’re a BOLO member, it’s free and you get 2 Continuing Ed credits). $40 for non-members. This workshop often sells out so reserve your spot today. Register Online Here.
A Summer Harvest of Design Awards!
We are grateful and humbled to have received a bumper crop of awards this summer. They include AIA Colorado’s Award of Merit in Sustainable Design for the LEED Platinum Hoefling House AIA (here’s a cool video of all the amazing award entries); 5280’s Top Denver Spaces, three Master Design Awards for ‘Big House on the Prairie’ and a Luxe Regional RED Award for the Grandview ‘jewel box’ wine room. We also were acknowledged with “Best of” in both the Design and Service categories from Houzz & Top Mountain Architects List from Mountain Living Magazine for the 13th year in a row.
Rodwin Architecture wins 2022 AIA Award of Merit in Sustainability!
We are honored to announce that The Hoefling House, our LEED Platinum custom home in Boulder built by Skycastle Construction, has won the 2022 AIA Design Award of Merit in Sustainability! The AIA Colorado Annual Design Awards honor the most outstanding work of AIA Colorado members and their firms, reinforce the value of great architecture and highlight members’ positive contributions to the community. Previous design award recipients have designed innovative schools, stunning custom homes, creative hotels, excellent community gathering spaces, and much more. We are delighted to be amongst the recipients in 2022 and congratulate all the winners in each category this year! .
ON THE BOARDS!
We have a number of exciting new Net-Zero Energy custom homes in design and under construction right now. Here’s a little teaser of some of the projects we have on the drafting board (yes, we still actually use an old fashioned drafting board). The design of each of these unique houses reflects a balance between our clients’ design aesthetic and space requirements, the views and influences of the site, passive solar design, ignition-resistant construction (several are part of the Marshall Fire rebuilding effort), and the artistry of each of the talented designers here at our firm. While each one is distinct in their expression, our deep-green custom homes have several things in common. Nearly all are Net-Zero energy or regenerative. All respond to the nuanced influences of their site. All respond thoughtfully to the practical needs and the specific tastes of our clients.
New $10,000 incentive for Marshall Fire rebuilds
As Boulder County continues to recover from and adapt to the intensifying impacts of the climate crisis, Governor Jared Polis signed into law SB22-206. This landmark bill provides critical firefighting support, helps Coloradans build back with resilience in the wake of future natural disasters, and establishes an Office of Climate Preparedness that will take a long-term approach to wildfire mitigation. SB22-206's first offering will be a grant program from the Colorado Energy Office for homes lost in the Marshall Fire and East Troublesome Fire. These grants will provide $10,000 for high efficiency electric homes or long-term rental units. To qualify for this incentive, the rebuilt homes must use heat pumps for space heating, electric stoves (either electric resistance or induction), and heat pump water heaters. Incidental gas use for equipment, such as fireplaces or grills, is allowed. Read the full report here.
Additional information regarding rebuilding after the Marshall Fire can be found here.
Third fastest growing private company in Boulder Valley!
Thanks to BizWest for recognizing Rodwin Architecture as the third fastest growing private company in Boulder Valley! Congratulations to all the local companies that made the Top 100!
'Rebuilding after the Marshall Fire', Boulder County Real Producers, June 2022
“Talking about rebuilding can be a contentious subject, as individual experiences. But it’s also vitally important to discuss the realities of rebuilding candidly and share information so that the whole community can rally as effectively as possible to support those impacted”.
Sharing this article from Scott in this month’s Boulder County Real Producers, where he addresses the process of rebuilding after our community’s devastating Marshall Fire.
Check out our Hempcrete Wall in Boulder!
A giant thanks to Eamonn McNaughton (eamonn@rmhempbuild.com) and the Rocky Mountain Hemp Build crew. Check out this video outlining the building of the wal!.
Stop by anytime to see the finished product at 15th and Quince.
Hempcrete Wall Building Workshop!
It was a blast! About 45 volunteers (including some CGBG members) enjoyed learning about hempcrete, meeting new friends, making new connections and being part of such a wonderful project. It is turning out amazingly. Hopefully such a public example will help stimulate the use of hemp for construction projects throughout the state.
A giant thanks to Eamonn McNaughton (eamonn@rmhempbuild.com) and the Rocky Mountain Hemp Build crew. They were true rock stars! We nearly finished. Eamonn, I and a few other folks will be getting back together all day Saturday to finish it up. We would be happy to have anyone join us – feel free to invite your friends, and spread the word. People can come for as long or short as they wish. Sign up here.
Stop by anytime to see the finished product. Here’s a link to a Google Drive album.
Scott Rodwin to be the next AIA North Chapter Director
Principal Scott Rodwin became the Director of the American Institute of Architects Colorado North Section this year. He has focused the AIA’s resources to support the Marshall Fire rebuilding process, helping to organize multiple educational events, and coordinating with Boulder County and related non-profits. Scott has volunteered every year for the last 30 years with the AIA, focused primarily on promoting sustainable design. He was Chair of the state’s Committee on the Environments from ‘95-98, President of the North Chapter in ’05, and a presenter at state and national conferences. In addition to the fire rebuild and sustainability, Scott’s primary concerns are to work on Colorado’s housing affordability crisis and to increase diversity within the profession.
Public Access Webinar: 'What To Ask Before You Build!' - Advice from Green Building Pros.
For those of you embarking on the process of building a home, and particularly for those impacted by the Marshall Fire, CGBG recently hosted a webinar entitled ‘What To Ask Before You Build - Advice from Green Building Pros.’ As well as the free recording, we also wanted to share an informative worksheet that they created to get you started, and help you make decisions about the priorities most important to you. Thanks to CGBG for continuing to be an excellent resource - as always!
Michelle Oddo, Brett Sawyer, and Scott Rodwin Discuss Boulder Real Estate
Great piece as Brett Sawyer and Michelle Oddo visit Boulder and discussing the local real estate and building scene with Scott for an upcoming episode of ‘Financing the American Dream’. Watch here
'What to Ask Before You Build' - Advice from Green Building Pros
In the wake of the Marshall Fire there are hundreds of families in Boulder County in need of practical, useful advice as they take their initial steps toward the rebuilding process. This event will be the first of a year-long series of conversations and trainings intended to grow the connection between high performance building professionals and those in the public looking for answers while also widening the circle of professional knowledge in the building community.
This event on February 15th at 6pm will be a structured panel discussion with ample Q+A time available. The panel is made up of local building professionals, many of whom have personal experience with either the Marshall Fire or previous wildfire incidents.
The conversation will focus on essential design elements of residential construction that will make the most impact to the performance of future homes without breaking the bank. By the end, the audience will know what top ten things professionals think you should be thinking about before you build.
This event has a maximum capacity of 500 participants, please register to hold your spot on February 16th at 6:00pm MST.
Brandon David promoted to Partner and President of Skycastle Construction
We are delighted to announce that Brandon David is now a Partner and President of Skycastle Construction (Scott will remain CEO). Brandon has been with the firm for over 15 years and has led our commitment to quality, innovative design/build method of delivery, passion for cutting-edge sustainability, and the development of Skycastle’s staff and project management. It is time that he is fully recognized for his tireless work ethic, his integrity & sense of responsibility, his technical skill and his leadership of our firm. We thank him, respect him to the moon, and are so excited to have him lead our construction team into the future. (Bonus factoids: Professional Builder Magazine named Brandon to their national ‘40 under 40’ back in ’14. He has 25 years of construction experience and magically blends that with 22 years of design. He received his B.S. in Architecture with Honors from the University of Utah in 1999 and a Bachelors of Environmental Design with Honors from the University of Colorado in 2004 (where he worked on the National Champion C.U. Solar Decathlon project). He is the proud father of three children and loves having adventures with his wife and family.)