Reinforcing the Rural-Home Market

From left, Don Pitts and Craig Young
From left, Don Pitts and Craig Young

With a long tradition of building homes in rural areas, United-Bilt Homes LLC now also offers everything from initial financing to site planning to make itself a full-service firm for homebuyers. The company was founded in 1958 as a spin-off of a lumberyard, and it now has corporate offices in Springdale, Arkansas, and Shreveport, Louisiana—with additional satellite offices in Texas, Oklahoma, and Missouri. The company caters primarily to entry-level and first-time move-up buyers, but it also works on second homes and step-down homes for retirees. Because it’s a family-owned company, president and CEO Don Pitts has the pleasure of working with his sons Darrin and Donnie, who work in sales, financing, underwriting, and lumberyard management. Here, Pitts and executive vice president Craig Young discuss their successful business strategy and the homebuilding market in their five-state region.

At a Glance

Locations
Springdale, AR, and Shreveport, LA

Founded
1958

Employees
175

Specialties
Residential homebuilding and financing

Annual Sales
$60 million

Can you explain why you chose to focus on rural areas?
Don Pitts: Over the years it’s been difficult for the rural market to obtain financing. Most lenders did not want to go to rural areas. We have always built in rural areas as well as in the city. Americans have a dream of owning their own home, and we make it easy for them with in-house financing—without having to go through a lot of red tape. Most people will have their own land, and we’ll build on their property.

Can you explain the operations of your business?
DP: We have 22 sales locations, each with a build radius of 75 miles. All the construction materials come from our distribution center in Shreveport. We own our own lumberyard and a large warehouse, which allows us to control the quality of the materials. We build our own trusses. We’re able to keep costs down on the trucking of materials, too. Whenever there’s a house sold and paperwork completed, we order materials to the warehouse, assemble all the materials needed, and deliver [them] with 18-wheelers to the job site.

We describe ourselves as a residential builder and finance company. It works well and we can control the underwriting better. By having our own financing, we can get our customers into a home they can afford. If we didn’t have the financing, we would be restricted to whatever the secondary market dictated.

How has business been for United-Bilt Homes in a down economy?
Craig Young: This fiscal year we’ve had around 460 closings. Sales will be north of $60 million for the year. In addition, our financing and insurance programs have pushed sales up to $70 million. We’ve been increasing despite the down economy. The rural-homebuilders market has not been hit nearly as hard as some of the tract homes in subdivisions. We’ve been actually seeing uplift every year during the recession.

One of United-Bilt Homes’ most popular home designs, the Aspen with Loft, can accommodate a two- or three-bedroom floor plan. The firm not only builds such residences; it also helps find financing options for them.

How have you been able to increase business?
CY: We continue to be a one-stop shop for the customer. We want to help homebuyers with their plan designs. We’ve got our own CAD department. We’ve built homes for over 35,000 customers, so we have an extensive selection of floor-plan designs. They can go through our catalog or even bring their ideas sketched on a napkin. We can help them with their financing and homeowner insurance and manage the construction so [that] there’s no need for them to deal with the bank or architect. Having a diverse footprint over five states certainly helps. We’re in enough markets to help insulate us from the ups and downs of the economy.

DP: We try to make a good friend out of our customers. We’ve built a solid reputation so that people know that if they want a home built, they come to United-Bilt Homes. Much of our business comes from referrals. We attribute this to our focus on customer satisfaction and building relationships with our buyers.

What products and vendors do you use for the building of your homes?
DP: We buy our lumber from Temple Inland, a large company with their own forest and government-inspected mills. We use quality name brands such as James Hardie HardiPlank fiber-cement siding, Advantech flooring systems, and TAMKO roofing. We also use low-e HR Windows and Sherwin Williams paint. We chose these vendors for quality and accessibility; they have plants in more than one location, and they keep our inventories to the levels we need.

What’s ahead for United-Bilt Homes in 2012?
CY: It is shaping up to be a good year. We were able to acquire seven new offices in Texas and Oklahoma from a competitor in 2009. We’re continuing to build our brand in each of those new markets, and we expect that we will hit our stride with our new locations. ABQ