Remodeling Trends and Homeowner Motivations with Eric Finnigan

Intro: 00:00:00

Welcome to the Construction Disruption Podcast, where we

Intro: 00:00:04

uncover the future of design, building, and remodeling.

Todd Miller: 00:00:17

I'm Todd Miller of Isaiah Industries Manufacture,

Todd Miller: 00:00:20

specialty residential metal roofing and other building materials.

Todd Miller: 00:00:23

And today I am your host of Construction Disruption.

Todd Miller: 00:00:27

So we are into Season 2 at this point.

Todd Miller: 00:00:30

And once again, we are doing Challenge Words.

Todd Miller: 00:00:33

Where both the guest and myself Have been given a word that we

Todd Miller: 00:00:36

are challenged to work into the conversation as seamlessly as possible.

Todd Miller: 00:00:41

So you, the listener can be listening to see if you recognize our challenge word.

Todd Miller: 00:00:45

So, um, I got a couple of quick stories, uh, to tell our, our

Todd Miller: 00:00:48

audience here before we get started.

Todd Miller: 00:00:50

Um, first one, this was kind of cool.

Todd Miller: 00:00:52

So everyone's been familiar in recent years with the resurgence of vinyl records

Todd Miller: 00:00:58

and, and listening to records on vinyl.

Todd Miller: 00:01:00

Again, we get away from all the CDs and stuff.

Todd Miller: 00:01:02

Well, I saw this thing the other day that some.

Todd Miller: 00:01:05

Has come out with a record player that is entirely made of chocolate.

Todd Miller: 00:01:11

It sounds pretty sweet when you listen to it.

Todd Miller: 00:01:14

Okay.

Todd Miller: 00:01:14

So you'll have to, lets talk, think about that one a little bit.

Todd Miller: 00:01:17

So, one other story would you wanna share with you?

Todd Miller: 00:01:19

So, um, a few years ago, my wife and I started to enjoy going on hikes.

Todd Miller: 00:01:24

Um, we would just go to a local park.

Todd Miller: 00:01:27

We have a really beautiful one in our town, and, and we would just kind of

Todd Miller: 00:01:30

go on a nature walk sort of thing.

Todd Miller: 00:01:31

And, uh, I would oftentimes, um.

Todd Miller: 00:01:34

Kind of put together sort of a song mix for us to listen to as we walked.

Todd Miller: 00:01:38

And, uh, I, I really came up with a perfect, uh, song mix for our, our hikes.

Todd Miller: 00:01:44

Um, I would play some songs from the Peanuts movie from years ago.

Todd Miller: 00:01:48

Um, and then I would have some songs done by the Cranberries and I would

Todd Miller: 00:01:52

also have some songs by M and M.

Todd Miller: 00:01:55

Um, I called it our trail mix.

Todd Miller: 00:01:57

Okay, so let's just go ahead and just get started with the show here if that's okay.

Todd Miller: 00:02:01

So today I'm kind of excited.

Todd Miller: 00:02:03

We have a repeat offender on our show, a repeat guest.

Todd Miller: 00:02:06

Actually, I really couldn't be more excited.

Todd Miller: 00:02:09

It's been nearly a year and a half since Eric Finnegan was our guest and

Todd Miller: 00:02:13

during his first interview, I have to say he really opened my eyes to

Todd Miller: 00:02:18

some new views and insights into the construction and remodeling industry.

Todd Miller: 00:02:24

So Eric is the vice president of building products, research and demographics

Todd Miller: 00:02:29

with John Burns research and consulting.

Todd Miller: 00:02:33

Eric says, Eric has a master's degree in economics from Fordham university.

Todd Miller: 00:02:37

Um, I follow him especially on LinkedIn and he is, I tell you,

Todd Miller: 00:02:41

he's just a veritable cornucopia of information, data, statistics, and

Todd Miller: 00:02:47

insight into our great industry.

Todd Miller: 00:02:50

Um, if you want to know where things are going, Eric, in my opinion, is

Todd Miller: 00:02:53

one of the top guys that you really should be following in our industry.

Todd Miller: 00:02:57

Again, Eric Finnegan, as it says on his LinkedIn profile, his goal is to provide

Todd Miller: 00:03:03

demographics clarity for our industry.

Todd Miller: 00:03:06

Um, Eric, welcome to Construction Disruption.

Todd Miller: 00:03:09

It's great to have you back here today.

Eric Finnigan: 00:03:11

Yeah, glad to be here, Todd.

Eric Finnigan: 00:03:13

I've been looking forward to this all week.

Todd Miller: 00:03:15

Fantastic.

Todd Miller: 00:03:16

Well, you know, I think maybe a great place for you to start, because it has

Todd Miller: 00:03:19

been a year and a half since you've been on, um, is to give us an overview

Todd Miller: 00:03:24

of John Burns Research and Consulting.

Todd Miller: 00:03:26

Um, you guys have actually gone through a little bit of a name

Todd Miller: 00:03:29

change since the last time we talked.

Todd Miller: 00:03:31

Um, so tell us a little bit about that and things you guys

Todd Miller: 00:03:34

are involved in these days.

Eric Finnigan: 00:03:36

Sure.

Eric Finnigan: 00:03:36

So, John Burns Research and Consulting now.

Eric Finnigan: 00:03:39

It used to be John Burns Real Estate Consulting.

Eric Finnigan: 00:03:42

Uh, small change, but it sort of accurately captures or reflects that

Eric Finnigan: 00:03:47

we have a half of, about half of our business is research, research

Eric Finnigan: 00:03:52

analysis and insights for a broad, basically any company involved.

Eric Finnigan: 00:03:57

In the housing market, so that's building product manufacturers.

Eric Finnigan: 00:04:00

It's homebuilders.

Eric Finnigan: 00:04:01

It's apartment developers, um, investors in the space.

Eric Finnigan: 00:04:06

Uh, and then about half of our business is on development, consulting feasibility

Eric Finnigan: 00:04:10

studies, market studies for, uh, uh, maybe say a builder that wants to understand

Eric Finnigan: 00:04:16

demand in a very hyper local, uh, market or part of part of a sub market.

Eric Finnigan: 00:04:22

Basically anywhere in the country.

Eric Finnigan: 00:04:24

We work all over the country.

Eric Finnigan: 00:04:26

Uh, I really have over the last year.

Eric Finnigan: 00:04:28

So, um, what we try to do is, is distilled down.

Eric Finnigan: 00:04:34

We try to capture what's happening today.

Eric Finnigan: 00:04:36

It's based on all the resources that we can pull together market

Eric Finnigan: 00:04:41

market studies data out there.

Eric Finnigan: 00:04:43

We talked to our, uh, we talked to people out there in the market that are selling

Eric Finnigan: 00:04:47

homes, building homes and stuff like that.

Eric Finnigan: 00:04:50

Understand today really in service of planning and really understanding and

Eric Finnigan: 00:04:54

making decisions about the future.

Eric Finnigan: 00:04:56

So that's that's our that's our big focus.

Eric Finnigan: 00:04:58

I'd say, as a company, we maniacally focus on understanding today so

Eric Finnigan: 00:05:04

that we can help our clients.

Todd Miller: 00:05:09

Well, it's certainly good stuff and no doubt about it.

Todd Miller: 00:05:12

We are in such a huge industry that impacts really the whole nation and

Todd Miller: 00:05:17

economy and housing and all kinds of things to such a great degree

Todd Miller: 00:05:21

that I love what you guys are doing.

Todd Miller: 00:05:24

So that's kind of my feelings as far as, you know, why it's really

Todd Miller: 00:05:28

neat what you guys are doing and an important part of the industry.

Todd Miller: 00:05:31

I'm kind of curious for you personally, um, what really interests you about.

Todd Miller: 00:05:36

Construction and remodeling industries.

Todd Miller: 00:05:38

What, what kind of captures your, Hey, this is.

Todd Miller: 00:05:41

This is why I'm patient about this.

Eric Finnigan: 00:05:43

It's a good question.

Eric Finnigan: 00:05:43

I think there's a couple of different answers to that.

Eric Finnigan: 00:05:45

1 is I, I, uh, I'm a, I'm a data guy.

Eric Finnigan: 00:05:50

Um, I've, I've never built a home myself.

Eric Finnigan: 00:05:52

I, you know, we just, we just bought our 1st homes.

Eric Finnigan: 00:05:55

I actually haven't done any remodeling yet other than, um.

Eric Finnigan: 00:06:00

Uh, some, some light repairs, but I think with, oh, you will, it'll catch you.

Eric Finnigan: 00:06:03

I will.

Eric Finnigan: 00:06:04

Yeah, I'm looking forward to that actually.

Eric Finnigan: 00:06:09

Uh, but the thing that I would say I'm most passionate about

Eric Finnigan: 00:06:12

is the fact that the work that.

Eric Finnigan: 00:06:16

We do in this industry touches every single person in the country

Eric Finnigan: 00:06:20

every single day of their lives.

Eric Finnigan: 00:06:22

It's it's where they fall asleep at night.

Eric Finnigan: 00:06:25

Um, and, you know, you look at this, these, like, hire the

Eric Finnigan: 00:06:30

mezzles hierarchy of needs.

Eric Finnigan: 00:06:31

So it's the foundation is secure housing.

Eric Finnigan: 00:06:35

Right.

Eric Finnigan: 00:06:36

Many of us, we want to feel secure at our home.

Eric Finnigan: 00:06:38

We want to be proud of it.

Eric Finnigan: 00:06:39

It's a long term investment.

Eric Finnigan: 00:06:41

Um, I would say that there's, it's the biggest purchase that most

Eric Finnigan: 00:06:45

people make in their lives is their, their home or if they rent, it's

Eric Finnigan: 00:06:49

their biggest monthly expense.

Eric Finnigan: 00:06:52

And I think it's a, personally, it's a, it's a really exciting place to be.

Eric Finnigan: 00:06:56

I mean, I've moved around so many times since I was, you know, left my

Eric Finnigan: 00:07:00

house where I grew up to go to college.

Eric Finnigan: 00:07:02

It's crazy.

Eric Finnigan: 00:07:03

Um, just seeing the different, all the different kind of way I've lived over

Eric Finnigan: 00:07:07

the last, say, 20 years, way everyone else lives, you can really learn a

Eric Finnigan: 00:07:11

lot about people also by understanding what choices they make around housing.

Eric Finnigan: 00:07:16

So there's a lot of different answers to that, but I think

Eric Finnigan: 00:07:18

just the fact that we all.

Eric Finnigan: 00:07:21

Anyone listening to this has a home, right?

Eric Finnigan: 00:07:23

And it affects everyone.

Todd Miller: 00:07:26

Yeah, good, good stuff.

Todd Miller: 00:07:28

Well, you know, when we met before, um, and we were on the show, um, we

Todd Miller: 00:07:32

were still pretty much in the midst of coven, you know, at this point, now that

Todd Miller: 00:07:36

it's at least somewhat, we hope in our rear view mirror, um, how do you see

Todd Miller: 00:07:41

things shaking out since the pandemic?

Todd Miller: 00:07:43

Any, um, particularly maybe surprising permanent impacts

Todd Miller: 00:07:48

you think from, uh, coven?

Eric Finnigan: 00:07:50

Yeah, I remember when we just had it last time it was It was,

Eric Finnigan: 00:07:53

it was a little bit at the tail end and we were wondering a lot of stuff.

Eric Finnigan: 00:07:58

So much has changed since that, since, you know, the beginning of COVID, right?

Eric Finnigan: 00:08:01

Like house prices skyrocketed.

Eric Finnigan: 00:08:04

Um, people were, a lot of people working from home for the first

Eric Finnigan: 00:08:08

time, um, you know, moving further and further from their offices.

Eric Finnigan: 00:08:14

Uh, mortgage rates, you know, went down to record lows and then they

Eric Finnigan: 00:08:18

were, I think right in the middle of our conversation, they were

Eric Finnigan: 00:08:21

skyrocketing in a pretty big way.

Eric Finnigan: 00:08:24

Um, so right around then I remember thinking, we were thinking, what

Eric Finnigan: 00:08:30

does this do to housing, right?

Eric Finnigan: 00:08:32

Mortgage rates go from under 3 percent to ultimately over 8 percent at one point in

Eric Finnigan: 00:08:38

the span of about a year, year and a half.

Eric Finnigan: 00:08:41

And.

Eric Finnigan: 00:08:43

A couple of things have, I think, become more clear that, uh, by this,

Eric Finnigan: 00:08:47

by this point, one is that, um, about 30 percent of workdays, so let

Eric Finnigan: 00:08:55

me just say that again, because I'm trying not to speak like an economist.

Eric Finnigan: 00:08:59

Sometimes my mind thinks that way, uh, there's millions

Eric Finnigan: 00:09:04

of people working from home.

Eric Finnigan: 00:09:07

At least half of the week now, a third to a half of the week, right?

Eric Finnigan: 00:09:13

So I'm, I'm working from home right now.

Eric Finnigan: 00:09:15

I need a whole room in my house to, to, to do that.

Eric Finnigan: 00:09:19

Um, and I'm one of, like I said, millions of people.

Eric Finnigan: 00:09:22

So there's millions of extra rooms in homes being used today that

Eric Finnigan: 00:09:26

were not used five years ago.

Eric Finnigan: 00:09:29

So, just think of people need more space, uh, they need more privacy, if they

Eric Finnigan: 00:09:36

were living with roommates before, now they, uh, more, more of them are willing

Eric Finnigan: 00:09:40

to pay for an extra bedroom in their apartment so that they can work from home.

Eric Finnigan: 00:09:45

They're willing to move further out where they can afford larger homes.

Eric Finnigan: 00:09:49

Uh, so this work from home piece.

Eric Finnigan: 00:09:53

Has, I think, permanently shifted the housing market in a way that something

Eric Finnigan: 00:09:56

like the automobile affected the housing market, um, something like phones affected

Eric Finnigan: 00:10:02

the housing market, letting you live farther and farther away from your, the

Eric Finnigan: 00:10:07

place that you do business, or maybe some of your family, this work from home.

Eric Finnigan: 00:10:12

The technology has been there for 10 years or so to allow it to happen, but

Eric Finnigan: 00:10:17

it really took the drastic shift from COVID to actually have people realize

Eric Finnigan: 00:10:23

on a really mass scale, it can be done, it can be done really effectively.

Eric Finnigan: 00:10:27

So I would say this, the work from home.

Eric Finnigan: 00:10:30

Uh, phenomenon is a permanent shift.

Todd Miller: 00:10:33

Very interesting.

Eric Finnigan: 00:10:34

There's a few others too.

Eric Finnigan: 00:10:35

Like I would say, you know, when, when mortgage rates were record low,

Eric Finnigan: 00:10:40

uh, under 3 percent in many cases for people, um, millions and millions

Eric Finnigan: 00:10:45

of people refinance their mortgage.

Eric Finnigan: 00:10:46

So we have about, uh, three quarters to.

Eric Finnigan: 00:10:51

To 80 percent of outstanding mortgages today are under 5%.

Eric Finnigan: 00:10:56

So they're paying a rate that is much, that's pretty far under where they

Eric Finnigan: 00:11:02

would have to reset their rate if they go to refi or they go to move.

Eric Finnigan: 00:11:06

So it's just this, um, long term large financial incentive to just stay put.

Eric Finnigan: 00:11:14

So it's what we call, we've been calling the lock in effect.

Eric Finnigan: 00:11:17

It's pretty well known at this point.

Eric Finnigan: 00:11:19

Um, and the, The FHFA, which is a federal housing finance agency,

Eric Finnigan: 00:11:26

just came out with a study actually this week pointing out how much of

Eric Finnigan: 00:11:30

an impact that's had on housing.

Eric Finnigan: 00:11:32

It's, you know, responsible for hundreds of thousands of,

Eric Finnigan: 00:11:35

um, home sales not happening.

Eric Finnigan: 00:11:37

So like hundreds of thousands of households that would have moved

Eric Finnigan: 00:11:40

at this point, just haven't.

Eric Finnigan: 00:11:42

That's kept resale inventories low.

Eric Finnigan: 00:11:44

It's kept prices high.

Eric Finnigan: 00:11:46

Um, It's actually a really good piece for remodeling.

Eric Finnigan: 00:11:50

If you're in the remodeling industry, where instead of moving to a larger

Eric Finnigan: 00:11:54

home, a trade up home, for instance, or if you're a 65, 70 year old, and

Eric Finnigan: 00:12:00

maybe you think about trading down or moving somewhere else, it's a big

Eric Finnigan: 00:12:04

incentive to actually stay put and upgrade and improve your current home.

Eric Finnigan: 00:12:09

So we've seen that a lot in our remodeling surveys, actually.

Eric Finnigan: 00:12:12

Yeah,

Todd Miller: 00:12:13

you know, it's been interesting over the years.

Todd Miller: 00:12:15

I mean, we manufacture fairly high end riffing materials and we have

Todd Miller: 00:12:19

always seen and, and, and heavily focused on the remodeling market.

Todd Miller: 00:12:23

And we have always seen that, um, we're, we kind of go the opposite of the economy.

Todd Miller: 00:12:28

Um, you know, when a new construction is down and people are

Todd Miller: 00:12:31

staying put, we tend to, to grow.

Todd Miller: 00:12:33

So I, I think.

Todd Miller: 00:12:34

It makes a lot of sense.

Todd Miller: 00:12:36

Well, I saw recently on LinkedIn where you had put a post out about recently

Todd Miller: 00:12:41

released 2023 census information and you know that information tends to not

Todd Miller: 00:12:49

necessarily have impact but show a lot happening that's going to affect housing.

Todd Miller: 00:12:55

What are some high points of that recently released information

Todd Miller: 00:12:58

that you can share with us?

Eric Finnigan: 00:13:00

Sure, so It's one of the most exciting days of my year, I

Eric Finnigan: 00:13:04

would say, and, uh, don't tell anyone that, because that, I'm just a huge

Eric Finnigan: 00:13:08

nerd, uh, so, I think there's a, there's a couple of different pieces.

Eric Finnigan: 00:13:14

One is that we know from, so the census basically estimated 2022 population

Eric Finnigan: 00:13:21

for every county across the country.

Eric Finnigan: 00:13:24

And what we found out was that, Um, like, like, before suburbs are the

Eric Finnigan: 00:13:30

growth engine of of the country's population and of the housing market.

Eric Finnigan: 00:13:35

Um, the suburbs grew about 1.

Eric Finnigan: 00:13:37

2M people last year.

Eric Finnigan: 00:13:40

If you include the excerpts, which are like this, the county is just

Eric Finnigan: 00:13:44

outside the suburbs and the outer rings of many of the larger cities.

Eric Finnigan: 00:13:48

Those grew an extra 200, 000.

Eric Finnigan: 00:13:50

So we can say about a 1.

Eric Finnigan: 00:13:52

5M.

Eric Finnigan: 00:13:52

People are going to have more people live in the suburbs and excerpts

Eric Finnigan: 00:13:57

versus a year ago, which is a pretty, which is substantial growth.

Eric Finnigan: 00:14:00

Right.

Eric Finnigan: 00:14:01

Um, and it makes sense because that's where there are homes to move into.

Eric Finnigan: 00:14:05

That's where people are moving from from cities out to the, to the suburbs.

Eric Finnigan: 00:14:11

That's where builders are delivering homes.

Eric Finnigan: 00:14:14

Uh, that's where there's, you know, good schools, et cetera.

Eric Finnigan: 00:14:17

One other key piece, though, is we actually saw early on in COVID that

Eric Finnigan: 00:14:21

people, a lot of people left cities, you know, whether it's small families

Eric Finnigan: 00:14:25

or young couples, they were like, we want to move out of the city and buy

Eric Finnigan: 00:14:28

a house because now is the best time we could possibly do that with a 2.

Eric Finnigan: 00:14:32

7 percent mortgage rate.

Eric Finnigan: 00:14:35

So we saw cities lose a huge chunk of population in 2020 and 2021.

Eric Finnigan: 00:14:42

That's actually now basically stopped.

Eric Finnigan: 00:14:44

So people that were in cities that were relieving before, it's more

Eric Finnigan: 00:14:48

likely that if someone's moving as a city dweller, they're moving

Eric Finnigan: 00:14:51

to somewhere else in the city.

Eric Finnigan: 00:14:53

So a different apartment or a smaller home, um, and it's actually pretty much

Eric Finnigan: 00:14:59

in line with what we've seen with, with rental demand over the last year or so,

Eric Finnigan: 00:15:04

we can, we can Basically capture a lot of the population movements through, uh,

Eric Finnigan: 00:15:09

market stats and where people are moving.

Eric Finnigan: 00:15:12

So we just really saw that the urban populations, urban, urban areas

Eric Finnigan: 00:15:16

stopped losing population suburbs and excerpts really drove the growth.

Eric Finnigan: 00:15:22

Um, and then in terms of regions of the country, which is, I think,

Eric Finnigan: 00:15:24

is also super interesting, is that.

Eric Finnigan: 00:15:28

Uh, the Southeast over sort of like the smile states, I guess it's sort of like

Eric Finnigan: 00:15:34

this shape of like from the Carolinas down to Florida, Georgia, uh, Texas, Arizona.

Eric Finnigan: 00:15:41

Those are the very strong growth markets, growth states across the country, and

Eric Finnigan: 00:15:47

those are still growing extremely fast.

Eric Finnigan: 00:15:50

Um, The only caveat there is that the growth instead of being

Eric Finnigan: 00:15:54

red hot, sort of record high growth, it's come down a tiny bit.

Eric Finnigan: 00:16:00

Okay.

Eric Finnigan: 00:16:00

It's because there's just fewer homes to move into.

Eric Finnigan: 00:16:03

So fewer, uh, opportunities for people from say the Northeast or

Eric Finnigan: 00:16:07

from the upper Midwest to move to a better climate, uh, or lower taxes.

Eric Finnigan: 00:16:14

So there's still people moving.

Eric Finnigan: 00:16:15

It's just a slightly lower volume.

Eric Finnigan: 00:16:18

And that means that.

Eric Finnigan: 00:16:19

States that are losing population like New York and California, Illinois, New Jersey.

Eric Finnigan: 00:16:23

They're losing fewer people though.

Eric Finnigan: 00:16:26

The, the, the movement of people is generally still to

Eric Finnigan: 00:16:30

the south and the southwest.

Eric Finnigan: 00:16:32

Um, it's just a little bit less than it was during cobit.

Todd Miller: 00:16:36

Very interesting.

Eric Finnigan: 00:16:37

Yeah, and what that means for housing is just

Eric Finnigan: 00:16:39

there's a ton of housing demand.

Eric Finnigan: 00:16:41

If you look at the nation as a whole, uh, you know, the population is growing, we

Eric Finnigan: 00:16:45

think really fast, but if you can look at where the, where it's growing, where it's

Eric Finnigan: 00:16:49

mostly growing, it's sort of eye popping.

Eric Finnigan: 00:16:53

What.

Eric Finnigan: 00:16:54

What it looks like there, like the U.

Eric Finnigan: 00:16:55

S.

Eric Finnigan: 00:16:56

is a substantially, uh, I would say U.

Eric Finnigan: 00:17:00

S.

Eric Finnigan: 00:17:01

is, I've tried to think about this.

Eric Finnigan: 00:17:02

The U.

Eric Finnigan: 00:17:02

S.

Eric Finnigan: 00:17:02

is a growth market.

Eric Finnigan: 00:17:03

It's the big, it's, I think it'd be the second biggest economy in the

Eric Finnigan: 00:17:06

world at this point, um, but it's growing extremely fast, especially

Eric Finnigan: 00:17:11

in certain areas like the Southeast, Texas, Arizona, places like that.

Todd Miller: 00:17:16

Very good.

Todd Miller: 00:17:17

Well, I like that when you talk to us about the Southeast as the smile

Todd Miller: 00:17:20

states, I never really, never really heard it that way or thought of

Todd Miller: 00:17:23

it, but I'm going to remember that because now I think of, okay, those

Todd Miller: 00:17:27

are the states where crocodiles live.

Todd Miller: 00:17:30

I never smiled at a crocodile, but actually alligators live there,

Todd Miller: 00:17:32

but still I'll make the connection.

Todd Miller: 00:17:34

I'll, I'll remember that.

Todd Miller: 00:17:35

So cool stuff.

Todd Miller: 00:17:36

So how do you see this population shifts and, um, shrinkage?

Todd Miller: 00:17:42

Um, I mean, I, I understand how it impacts.

Todd Miller: 00:17:45

Housing and demand, but how is it impacting remodeling and what's

Todd Miller: 00:17:50

happening with, um, you know, our housing stock and aging?

Todd Miller: 00:17:55

And what do you project going out with remodeling?

Todd Miller: 00:17:57

It seemed like, you know, last year, we kind of saw, um, especially in higher

Todd Miller: 00:18:02

end remodeling, a little bit of a soft year, um, in the higher end stuff a

Todd Miller: 00:18:07

little bit, you know, fairly strong.

Todd Miller: 00:18:08

You're still in a lot of other areas.

Todd Miller: 00:18:11

Um, what does remodeling look like?

Todd Miller: 00:18:13

You know, as you look out again here,

Eric Finnigan: 00:18:15

That, I mean, that's, that's good to hear.

Eric Finnigan: 00:18:16

It's consistent with what we've heard from our remodeler survey.

Eric Finnigan: 00:18:20

Uh, so we go out to the, to the market with, um, with a survey partner,

Eric Finnigan: 00:18:25

qualified remodeler and ask remodelers what they're seeing in their markets.

Eric Finnigan: 00:18:30

Uh, basically every quarter.

Eric Finnigan: 00:18:33

What do they expect for demand in the future?

Eric Finnigan: 00:18:35

Um, and last year was definitely a softer year reset after this massive

Eric Finnigan: 00:18:39

boom during COVID, when everyone was, you know, pulling out homeowners basically

Eric Finnigan: 00:18:44

took out 250 billion of cash out of their home equity and spent it a lot

Eric Finnigan: 00:18:51

on remodeling also, you know, big RVs and things like that, but a lot of,

Eric Finnigan: 00:18:55

a lot of money spent on remodeling.

Eric Finnigan: 00:18:56

So if you could look at, You know, the, the trend and spending, you could see a

Eric Finnigan: 00:19:01

huge shift upward in 2020, 21, 22, uh, up above over and above what it was a

Eric Finnigan: 00:19:08

normal trend, you know, um, in 23, it's, it's, it fell below the long term trend.

Eric Finnigan: 00:19:15

So, uh, as sort of a give back, it's, you know, projects that would have happened.

Eric Finnigan: 00:19:20

Uh, in 23, did they just happened earlier?

Eric Finnigan: 00:19:23

Uh, we think that this, it sort of catches back up to the, to the trend

Eric Finnigan: 00:19:28

going, you know, going forward.

Eric Finnigan: 00:19:29

So, one is that.

Eric Finnigan: 00:19:31

A couple of pieces driving that one is that if the Federal Reserve starts

Eric Finnigan: 00:19:34

lowering interest rates this year, that makes home equity loans, um, home

Eric Finnigan: 00:19:39

equity lines of credit are directly tied to that federal funds rate.

Eric Finnigan: 00:19:42

Uh, so those are going to come down and, uh, one of the things actually a year and

Eric Finnigan: 00:19:47

a half ago is we were really uncertain about where home values would end up.

Eric Finnigan: 00:19:51

Uh, some markets, uh, like, like in Austin, Texas, for instance,

Eric Finnigan: 00:19:56

have really seen home prices fall pretty significantly, but for

Eric Finnigan: 00:20:00

most of the country, home prices didn't go down at all, and actually

Eric Finnigan: 00:20:03

they're starting to rise again.

Eric Finnigan: 00:20:05

So, I think I said this on our last, last interview, but it's, it's worth repeating,

Eric Finnigan: 00:20:10

which is that you want to look at the trend in, uh, Remodeling, especially

Eric Finnigan: 00:20:14

high end remodeling and big projects.

Eric Finnigan: 00:20:17

Just look at what home home values are doing in your local market.

Eric Finnigan: 00:20:20

And for most markets in most of the country, they're going up again.

Eric Finnigan: 00:20:25

Uh, so we think there's a real turnaround coming in, in remodeling.

Eric Finnigan: 00:20:29

It's starting to see a base and, you know, from our remodeler survey.

Eric Finnigan: 00:20:33

So we think 2024 is going to be a return to growth for, for remodeling.

Eric Finnigan: 00:20:38

Um, and then in terms of the parts of the country.

Eric Finnigan: 00:20:41

I would say it's two, two factors.

Eric Finnigan: 00:20:44

One is that, what is the age of the housing stock, right?

Eric Finnigan: 00:20:47

So we've, we've, we've identified this.

Eric Finnigan: 00:20:50

period of time, sort of 20 years after the home is finished, uh,

Eric Finnigan: 00:20:55

that most of the major systems and most of the major components of

Eric Finnigan: 00:20:59

the house, um, are now obsolete.

Eric Finnigan: 00:21:03

They require replacement or upgrading.

Eric Finnigan: 00:21:05

Um, so it's, it's 20 to sort of call it 39, but 20 to 40 years, that 20 year

Eric Finnigan: 00:21:11

window, most of the home gets upgraded.

Eric Finnigan: 00:21:15

And this is true across the country, um, and across time.

Eric Finnigan: 00:21:20

So it's a pretty predictable, uh, upgrade cycle.

Eric Finnigan: 00:21:24

So if you could look at where a lot of the homes are of that age, you can

Eric Finnigan: 00:21:29

predict, okay, here's where a lot of homes are going to need remodeling.

Eric Finnigan: 00:21:33

Um, and then a layer on top of that, again, thinking like an economist here,

Eric Finnigan: 00:21:39

but just, just follow me for a second.

Eric Finnigan: 00:21:41

Okay.

Eric Finnigan: 00:21:41

So you can find where homes are.

Eric Finnigan: 00:21:44

20 to 40 years old and where the area, the income of the area is high.

Eric Finnigan: 00:21:49

That sort of sets up a really, a real ripeness for that's there's a high

Eric Finnigan: 00:21:53

likelihood that that home is going to get a big remodeling project.

Eric Finnigan: 00:21:57

So, um, a team, a member of our team, Ian Kennedy is, is just a

Eric Finnigan: 00:22:02

wizard with maps and the census data.

Eric Finnigan: 00:22:04

He's put together a map that I can't show it on this podcast, but, uh,

Eric Finnigan: 00:22:11

I can, we can maybe post it later or something, but you can look at.

Eric Finnigan: 00:22:15

Every county in the country and see where, where, where do you find

Eric Finnigan: 00:22:19

this intersection of 20 to 40 year old homes and very high income.

Eric Finnigan: 00:22:24

And it turns out there's actually most, most cities, most major

Eric Finnigan: 00:22:26

cities in the country have a lot of these sort of ripe areas.

Eric Finnigan: 00:22:30

So.

Eric Finnigan: 00:22:33

From, you know, I'm looking at the map right now, but it's all across

Eric Finnigan: 00:22:36

down the Eastern seaboard from Boston to, um, New Jersey is a big

Eric Finnigan: 00:22:40

area all the way down to call it DC.

Eric Finnigan: 00:22:44

And then there's pockets in Atlanta, Houston, Dallas, Austin, lots in Florida.

Eric Finnigan: 00:22:51

It's really almost everywhere.

Eric Finnigan: 00:22:53

The country, I would say is going to.

Eric Finnigan: 00:22:55

Um, benefit from, from this sort of prime remodeling, uh, remodeling waves call it,

Todd Miller: 00:23:03

well, that makes a lot of sense.

Todd Miller: 00:23:04

I mean, even as I look at my own neighborhood, we're kind of now in that,

Todd Miller: 00:23:08

in that 40 year plus range, as far as age.

Todd Miller: 00:23:11

And, you know, during that 20 to 40 years, I saw a lot of people

Todd Miller: 00:23:14

doing replacement products, new kitchens, new refs, new siding.

Todd Miller: 00:23:18

Um, but now I'm also seeing people starting this, this

Todd Miller: 00:23:21

new phase doing more like.

Todd Miller: 00:23:23

Whole home remodels and major additions and those types of things.

Todd Miller: 00:23:27

So, uh, makes a lot of sense.

Todd Miller: 00:23:29

And yeah, we will definitely want to get that link, uh, to Ian's map,

Todd Miller: 00:23:33

uh, so that we can put it in the show notes because, uh, that sounds

Todd Miller: 00:23:37

like something of great interest to both, uh, remodeling contractors and

Todd Miller: 00:23:41

architects and designers, uh, as well.

Todd Miller: 00:23:45

Um, no, very interesting stuff.

Todd Miller: 00:23:48

Uh, good, good information.

Todd Miller: 00:23:50

Thank you.

Todd Miller: 00:23:51

Um, Yeah, I'm kind of curious and I think you've kind of already

Todd Miller: 00:23:55

give queued this up pretty good.

Todd Miller: 00:23:56

But, um, you know, if you were someone today, a contractor, just entering

Todd Miller: 00:24:01

construction or remodeling market, um, it kind of sounds like maybe that mid

Todd Miller: 00:24:07

to upper end remodeling would be an awfully good market for you to enter if

Todd Miller: 00:24:11

those types of homes were in your area.

Todd Miller: 00:24:14

And like you said, there's pockets of them every place.

Eric Finnigan: 00:24:18

Yeah.

Eric Finnigan: 00:24:18

So I think there, there's a couple of reasons why is it sort of the bottom

Eric Finnigan: 00:24:24

half of the market or the, maybe the bottom two thirds of the market.

Eric Finnigan: 00:24:27

So like a lot of people that do small projects or sort of the middle,

Eric Finnigan: 00:24:31

middle range of income people that are really splurging for their kitchen

Eric Finnigan: 00:24:34

upgrade or, uh, bathroom remodel, the demand cycles go up and down there.

Eric Finnigan: 00:24:41

So there's, there's some volatility.

Eric Finnigan: 00:24:43

So if you're, if you're entering the business for the first time,

Eric Finnigan: 00:24:46

I think one of the hardest things.

Eric Finnigan: 00:24:48

I can speak as a former.

Eric Finnigan: 00:24:50

Business owner, myself, the hardest thing is not being able to predict

Eric Finnigan: 00:24:54

what's going to happen next year.

Eric Finnigan: 00:24:56

So I would look at what are some areas of the market that are going

Eric Finnigan: 00:24:59

to be strong, very long term.

Eric Finnigan: 00:25:01

And there might be a little bit of ups and downs every year, but really strong long

Eric Finnigan: 00:25:05

term demand over the next 10, 20 years.

Eric Finnigan: 00:25:08

And we think that the.

Eric Finnigan: 00:25:10

Baby boom population or the people say over the over 60, uh, they're, they're

Eric Finnigan: 00:25:17

going to live if, if once they reach 60, their life expectancy at that

Eric Finnigan: 00:25:20

point is another 25 to almost 30 years.

Eric Finnigan: 00:25:24

So they're prepping to sort of stay in their home long term.

Eric Finnigan: 00:25:29

And I can tell the story about my, my mom here.

Eric Finnigan: 00:25:31

She's, she's getting up there and age and she's retired now for a handful of years.

Eric Finnigan: 00:25:36

Um, she owns a small home in our hometown, and we had a conversation with her last

Eric Finnigan: 00:25:41

year about where does she want to live?

Eric Finnigan: 00:25:44

Where does she want to actually grow old?

Eric Finnigan: 00:25:46

Is it the home she's in now, or does she want to figure out a situation

Eric Finnigan: 00:25:52

that, you know, maybe she doesn't want to maintain a home and replace the

Eric Finnigan: 00:25:55

roof, or, you know, Do figure out how to get the grass mowed every week.

Eric Finnigan: 00:25:59

Um, we had a conversation with her and she has a, she's like, I want to go somewhere

Eric Finnigan: 00:26:05

where I can take care of a garden.

Eric Finnigan: 00:26:07

I can have my cats.

Eric Finnigan: 00:26:09

Um, I can have privacy and thinking like, that's, that's really hard

Eric Finnigan: 00:26:14

to do in a condo or, uh, you know, a townhome or something like that.

Eric Finnigan: 00:26:18

So she's, she's like, I'm going to, I want to stay where I am.

Eric Finnigan: 00:26:21

I'm, I'm willing to make, you know, put a bunch of money into the

Eric Finnigan: 00:26:24

house to make it comfortable and make it accessible for what I'm.

Eric Finnigan: 00:26:29

Older, much and much older.

Eric Finnigan: 00:26:31

So I think there's a lot of that happening and we've, it's again,

Eric Finnigan: 00:26:34

borne out in a lot of our surveys that older people are prepping to

Eric Finnigan: 00:26:38

stay in their homes for a long time.

Eric Finnigan: 00:26:40

And this idea that they're, they're going to move to nursing homes

Eric Finnigan: 00:26:43

and active adult communities.

Eric Finnigan: 00:26:46

That's certainly happening on some level, but the baby boom population,

Eric Finnigan: 00:26:49

you got to think about them.

Eric Finnigan: 00:26:50

They were fiercely independent.

Eric Finnigan: 00:26:53

Much more so than their parents.

Eric Finnigan: 00:26:56

So they have just maintained that sort of streak of independence into old age

Eric Finnigan: 00:27:00

and they are postponing and putting off moving into sort of nursing home

Eric Finnigan: 00:27:06

type situations, the long term care facilities as long as they possibly can.

Eric Finnigan: 00:27:10

So that means they're going to stay where they are.

Eric Finnigan: 00:27:12

And the, the baby boom population as a whole has about 72

Eric Finnigan: 00:27:18

trillion of net worth today.

Eric Finnigan: 00:27:21

So.

Eric Finnigan: 00:27:22

It's not split evenly across the population.

Eric Finnigan: 00:27:25

The median is somewhere between three and five hundred thousand for the baby

Eric Finnigan: 00:27:29

boomers, but they have money to spend and they can't take it with them.

Eric Finnigan: 00:27:34

So they are actually a lot of them are spending it now and remodeling

Eric Finnigan: 00:27:37

their home or they're helping their adult children buy and rent homes.

Eric Finnigan: 00:27:40

We think that really that part of the market that's serving baby

Eric Finnigan: 00:27:44

boomers, especially at the high end, is a very strong market.

Eric Finnigan: 00:27:49

And will be for the next 10 years, 20 years.

Todd Miller: 00:27:53

Very interesting.

Todd Miller: 00:27:55

You know, you've touched on it already.

Todd Miller: 00:27:56

You've talked a little bit about, you know, baby boomers,

Todd Miller: 00:27:59

maybe even moving into Gen X.

Todd Miller: 00:28:01

As we look at the younger generations, we look at, you know, millennials

Todd Miller: 00:28:05

and Gen Y and those types of things.

Todd Miller: 00:28:08

Are you seeing any real different trends from them in terms of what

Todd Miller: 00:28:12

they want in terms of housing?

Todd Miller: 00:28:14

Now, uh, my son is, I guess, kind of on the young edge of

Todd Miller: 00:28:18

millennials, but honestly, he wants nothing to do with homeownership.

Todd Miller: 00:28:21

I don't know if that is typical of his age or if he's just the

Todd Miller: 00:28:25

outlier, which he probably is, but are there any trends you're seeing

Todd Miller: 00:28:28

in those younger generations?

Eric Finnigan: 00:28:30

So, yeah, so it makes sense that your son at the

Eric Finnigan: 00:28:33

younger end of millennial is not thinking about home ownership.

Eric Finnigan: 00:28:35

Um, I would say I'm at the other end of the millennial.

Eric Finnigan: 00:28:38

I'm just turned 40.

Eric Finnigan: 00:28:40

Uh, so I was born in 83, which is, you know, in the first few years

Eric Finnigan: 00:28:44

of the millennial generation.

Eric Finnigan: 00:28:47

The question about 10 years ago when I was in this space was the

Eric Finnigan: 00:28:52

same kind of question like our millennials gonna, uh, buy homes

Eric Finnigan: 00:28:57

and it's this big question, right?

Eric Finnigan: 00:28:58

So we graduated college, uh, enter the job market in the worst financial

Eric Finnigan: 00:29:04

crisis, the worst recession since 19 thirties and hundreds of student debt.

Eric Finnigan: 00:29:12

And it was, you know, this whole.

Eric Finnigan: 00:29:14

The idea that nobody wanted to own anything.

Eric Finnigan: 00:29:16

So we were, we would take Ubers everywhere and rent apartments and, and

Eric Finnigan: 00:29:22

get, you know, dinners delivered from, you know, all these apps and whatever.

Eric Finnigan: 00:29:28

And it's, it's a big shift from what came before and certainly some of that

Eric Finnigan: 00:29:32

happened, but it turns out over the last 10 years, you get to see the leading

Eric Finnigan: 00:29:36

edge of the millennial generation.

Eric Finnigan: 00:29:38

Uh, entered homeownership just a little bit later, just a couple of

Eric Finnigan: 00:29:42

years later than the people that came before them, the Gen Xers.

Eric Finnigan: 00:29:45

So the median age of first time homebuyers today is 35.

Eric Finnigan: 00:29:50

So that means by the time, um, if you look at 35 year olds today, half of them

Eric Finnigan: 00:29:54

are homeowners, half of them aren't.

Eric Finnigan: 00:29:57

And the general trend is that Uh, by the time people reach, you know, the

Eric Finnigan: 00:30:03

average of 45 50 55, there's a massive increase in the number of people that

Eric Finnigan: 00:30:08

owned homes and we don't have the data yet to point to the millennials doing that.

Eric Finnigan: 00:30:13

But they are following the exact shape of the increase in homeownership that the Gen

Eric Finnigan: 00:30:19

Xers did and that the baby boomers did.

Eric Finnigan: 00:30:21

So it's happening.

Eric Finnigan: 00:30:22

It's just a little bit.

Eric Finnigan: 00:30:24

A little bit delayed, right?

Eric Finnigan: 00:30:26

So and I think that the thing was with home ownership doesn't

Eric Finnigan: 00:30:30

make sense until it does.

Eric Finnigan: 00:30:33

And then one day or over the span of a year, like I could just tell from

Eric Finnigan: 00:30:37

my own personal experience that I was so against, not against owning, but

Eric Finnigan: 00:30:43

it just did not make sense for me.

Eric Finnigan: 00:30:44

I was moving occasionally.

Eric Finnigan: 00:30:46

I left New York city in 2015 and came out to Colorado.

Eric Finnigan: 00:30:50

I lived in Breckenridge.

Eric Finnigan: 00:30:51

I lived, I was like snowboarding every day for a year.

Eric Finnigan: 00:30:54

Took a, you know, took a year off to sort of reset.

Eric Finnigan: 00:30:57

It just didn't make sense to, to own a home at that point.

Eric Finnigan: 00:31:00

But then, it was like into my later 30s.

Eric Finnigan: 00:31:04

I got, I got married.

Eric Finnigan: 00:31:05

We got a dog.

Eric Finnigan: 00:31:06

There's, my wife has a stepdaughter, or I have a stepdaughter.

Eric Finnigan: 00:31:08

My wife has a daughter.

Eric Finnigan: 00:31:10

Um, and.

Eric Finnigan: 00:31:11

Suddenly renting is like, this doesn't make sense anymore.

Eric Finnigan: 00:31:14

I actually want a place of permanence.

Eric Finnigan: 00:31:16

I want to, I want to enjoy the stillness of home ownership in this,

Eric Finnigan: 00:31:21

in the security and the stability and the predictability of ownership.

Eric Finnigan: 00:31:25

And it finally made sense.

Eric Finnigan: 00:31:26

And it, um, and I think there's a, uh, I, I would say that story doesn't need

Eric Finnigan: 00:31:31

to be generalized to everyone, but it's a general trend that people at some

Eric Finnigan: 00:31:35

point in their thirties will realize they want to buy a house and then go do it.

Eric Finnigan: 00:31:40

So I would say, give your son a few years, maybe five or ten, he

Eric Finnigan: 00:31:44

might, he might change his mind.

Todd Miller: 00:31:46

So I think we've touched on that on the show before that maybe

Todd Miller: 00:31:49

it doesn't so much have to do with the generation as it does just age and those

Todd Miller: 00:31:55

things do, do come with age a little bit.

Todd Miller: 00:31:57

Exactly.

Eric Finnigan: 00:31:58

And just the millennial generation.

Eric Finnigan: 00:32:01

I just want to talk about the size for a second.

Eric Finnigan: 00:32:03

So there's 68 million baby boomers today.

Eric Finnigan: 00:32:06

Some of them, um, the population is starting to shrink and some

Eric Finnigan: 00:32:09

of them are, uh, are reaching old age and the end of their lives.

Eric Finnigan: 00:32:13

But the millennials are 74 million of us.

Eric Finnigan: 00:32:16

Wow.

Eric Finnigan: 00:32:16

And.

Eric Finnigan: 00:32:18

Uh, so we're actually much, we're actually bigger than the baby Google.

Eric Finnigan: 00:32:21

Um, and then Gen Z is behind us.

Eric Finnigan: 00:32:24

There's 71 million of them today.

Eric Finnigan: 00:32:28

But when you think about immigration, people generally come to the

Eric Finnigan: 00:32:32

country in that sort of twenties to early thirties timeframe.

Eric Finnigan: 00:32:38

Or late teens to come, come for, come for college or anything like that.

Eric Finnigan: 00:32:42

So the Gen X population is still growing.

Eric Finnigan: 00:32:45

So within a couple of years, uh, there there's going to be

Eric Finnigan: 00:32:48

more Gen Z's than millennials.

Eric Finnigan: 00:32:49

So there's just a, it's just a massive, massive tailwind

Eric Finnigan: 00:32:53

of people that are aging into.

Eric Finnigan: 00:32:56

Renting their first home, um, moving into their, um, home into

Eric Finnigan: 00:33:01

homeownership and trading up.

Eric Finnigan: 00:33:03

There's a big wave of people coming.

Eric Finnigan: 00:33:05

So we, that's why one of the things we've been talking about is just

Eric Finnigan: 00:33:08

stable, long term demand for housing.

Todd Miller: 00:33:13

Very interesting.

Todd Miller: 00:33:14

Good stuff.

Todd Miller: 00:33:15

Well, let's switch gears and talk about building materials a little bit.

Todd Miller: 00:33:19

Any growth or shrinkage, shrinkage trends in particular building material

Todd Miller: 00:33:24

products or product types that you're seeing out there that may have an impact.

Eric Finnigan: 00:33:29

Yeah, so I think two ways to think about this would be,

Eric Finnigan: 00:33:32

what is, what's the cycle of demand for different products right now?

Eric Finnigan: 00:33:35

And you can see that, um, one is that, yeah, demand for certain

Eric Finnigan: 00:33:40

products and the trend is the other one is just overall different.

Eric Finnigan: 00:33:44

Changes within product categories.

Eric Finnigan: 00:33:47

So, uh, for instance, single family builders are ramping up

Eric Finnigan: 00:33:52

production in 2024 and they were in the 2nd half of 2023 as well.

Eric Finnigan: 00:33:58

And we can start.

Eric Finnigan: 00:33:59

We can really see from our stats that.

Eric Finnigan: 00:34:01

Demand for materials that are used early on in the construction cycle have really

Eric Finnigan: 00:34:06

turned up at where a year ago, or when we were recording our last interview,

Eric Finnigan: 00:34:11

there was a real softening because builders were pulling back, slowing down.

Eric Finnigan: 00:34:15

So the demand for lumber demand for, um, certain other, uh, roof trusses, things

Eric Finnigan: 00:34:21

like that were, were Falling now that's actually growing pretty significantly

Eric Finnigan: 00:34:26

and because it was a big slowdown a year ago, the demand for materials that

Eric Finnigan: 00:34:30

are used at the end, the tail end of a single family home, uh, being built

Eric Finnigan: 00:34:35

and developed, those are actually pretty slow or slower right today.

Eric Finnigan: 00:34:40

So things like wall board or, uh.

Eric Finnigan: 00:34:43

Landscaping materials, things like that.

Eric Finnigan: 00:34:45

So we can kind of look at through, look through the cycle there, but

Eric Finnigan: 00:34:47

the other, I think there's other more interesting sort of longer term

Eric Finnigan: 00:34:51

shifts within product categories.

Eric Finnigan: 00:34:53

Look at like, what, what, where are they, where's the innovation happening today?

Eric Finnigan: 00:34:56

What kinds of innovations are taking off?

Eric Finnigan: 00:34:59

One is, uh, I like to think of what's the, what's the sort of innovation space today?

Eric Finnigan: 00:35:05

Like why, why innovate?

Eric Finnigan: 00:35:06

One is this is a massive labor shortage in the construction industry.

Eric Finnigan: 00:35:11

So what you'll see is that even though there's demand for homes, it's

Eric Finnigan: 00:35:16

really hard for builders to ramp up construction really quickly because

Eric Finnigan: 00:35:20

they just don't have the labor for it.

Eric Finnigan: 00:35:21

They don't have the skilled skills to do it.

Eric Finnigan: 00:35:23

Skilled labor to do framing or to do the skilled trades.

Eric Finnigan: 00:35:28

So you're fine.

Eric Finnigan: 00:35:29

You're seeing that, uh, building product manufacturers are innovating

Eric Finnigan: 00:35:33

through creating products that are easier and more efficient to install.

Eric Finnigan: 00:35:39

So actually requires less labor to install.

Eric Finnigan: 00:35:41

So some of our team members went to the International Builders Show, um,

Eric Finnigan: 00:35:46

IBS, KBiz, uh, end of last month.

Eric Finnigan: 00:35:50

Yeah, three or four weeks ago.

Eric Finnigan: 00:35:51

It seems like a while ago.

Eric Finnigan: 00:35:52

Uh, but one of them pointed out that, that, uh, uh, Pella, which is a window

Eric Finnigan: 00:35:57

manufacturer, uh, they came up with a new installation system that lets someone

Eric Finnigan: 00:36:02

install a window three times faster.

Eric Finnigan: 00:36:05

Wow.

Eric Finnigan: 00:36:06

And it's just, just one person versus the standard two person installation.

Eric Finnigan: 00:36:10

So again, just think about the labor savings there.

Eric Finnigan: 00:36:12

If you take that one window and put in, you know, a couple

Eric Finnigan: 00:36:16

dozen windows in a house.

Eric Finnigan: 00:36:18

So that's an example of labor saving that we're really on the lookout for.

Eric Finnigan: 00:36:21

I think it's really going to hopefully ease some of the productivity

Eric Finnigan: 00:36:25

issues in construction and let's builders ramp up production, even

Eric Finnigan: 00:36:30

though there's this labor shortage.

Eric Finnigan: 00:36:31

Another one is things like energy efficiency or efficiency with using

Eric Finnigan: 00:36:36

resources like There's a bunch of new like leak detection systems where if

Eric Finnigan: 00:36:42

there's a solid system in your house and if there's a water leak somewhere,

Eric Finnigan: 00:36:46

it just shuts off the main water valve.

Eric Finnigan: 00:36:48

So you're not wasting water.

Eric Finnigan: 00:36:50

It's going to be, I think, really important for places

Eric Finnigan: 00:36:52

that are for, that are really constrained on the water supply.

Eric Finnigan: 00:36:55

Right.

Eric Finnigan: 00:36:56

And then there's another one I saw that was kind of interesting and, and had me

Eric Finnigan: 00:37:01

think of a little bit about, uh, how that would but they seem to have developed a

Eric Finnigan: 00:37:05

system where you can recycle shower water.

Eric Finnigan: 00:37:09

And actually use it use the same water in the shower.

Eric Finnigan: 00:37:11

So the disinfected they obviously take out any kind of like any You

Eric Finnigan: 00:37:16

know hair or anything like that.

Eric Finnigan: 00:37:18

It's that's all filtered out, but it comes back into the showerhead as

Eric Finnigan: 00:37:21

clean water and Uh, so you're using a lot less water even though if you like

Eric Finnigan: 00:37:27

Like me, you like hot, long showers in the in the morning or at night.

Eric Finnigan: 00:37:31

So less, less water usage, I think, which is really interesting.

Eric Finnigan: 00:37:35

And then a big one is just for people are needing homes that are

Eric Finnigan: 00:37:39

affordable, which means builders having to build smaller homes and mean

Eric Finnigan: 00:37:44

space is sort of like the constraint space is at a premium, which means.

Eric Finnigan: 00:37:48

But if you can put a washer and a dryer, say, in the same unit, that's

Eric Finnigan: 00:37:54

a, that's a great selling point.

Eric Finnigan: 00:37:55

So we're starting to see some of those where it's taking, you know, large

Eric Finnigan: 00:38:00

appliances and shrinking them down.

Todd Miller: 00:38:02

Those are some very interesting trends.

Todd Miller: 00:38:04

I wish I would have gone to the Home Builder Show this year.

Todd Miller: 00:38:07

I did not.

Todd Miller: 00:38:07

But, uh, always a great place to see some of those things that are happening.

Todd Miller: 00:38:12

Um, well, Eric, this has been a great talk.

Todd Miller: 00:38:15

Um, thank you so much.

Todd Miller: 00:38:16

Always very interesting information.

Todd Miller: 00:38:18

We're close to wrapping up what we call the business end of things.

Todd Miller: 00:38:21

Is there anything, uh, that we haven't covered today that you'd like to

Todd Miller: 00:38:25

share with our audience or maybe just words of advice for folks out there?

Eric Finnigan: 00:38:30

Yeah, I think I'm like you.

Eric Finnigan: 00:38:32

I could talk about this stuff for hours.

Eric Finnigan: 00:38:34

So, um, and I often do so you can follow me on, on the internet somewhere.

Eric Finnigan: 00:38:39

I can post on LinkedIn.

Eric Finnigan: 00:38:41

I post on Twitter.

Eric Finnigan: 00:38:42

Um, I think it's just stuff that I find interesting and, um, kind of what

Eric Finnigan: 00:38:47

it means for the, for the industry.

Eric Finnigan: 00:38:48

So, yeah, there's a lot of stuff we didn't cover today that I'm,

Eric Finnigan: 00:38:52

I like to think about and track in terms of terms of advice.

Eric Finnigan: 00:38:56

That's, that's great.

Eric Finnigan: 00:38:57

That's a good, good question.

Eric Finnigan: 00:38:58

I don't know that I have really good advice for people.

Eric Finnigan: 00:39:01

I think it's more just like, uh, maybe the advice is don't take

Eric Finnigan: 00:39:05

my advice or don't take advice.

Eric Finnigan: 00:39:07

Figure it out for yourself.

Eric Finnigan: 00:39:08

Right?

Eric Finnigan: 00:39:08

There you go.

Eric Finnigan: 00:39:09

Which I think is natural for people in this industry.

Eric Finnigan: 00:39:11

There is like a natural proclivity to, for, you know, Independence,

Eric Finnigan: 00:39:17

self sufficiency, figuring out problems, creativity in some ways.

Eric Finnigan: 00:39:23

Um, I see lean, lean into what you're good at and, and, and, and follow that.

Eric Finnigan: 00:39:29

And, you know, maybe early on in the, in the career that you have to kind of like

Eric Finnigan: 00:39:33

work with what you're given, like work in the lane that you, you're, you're given.

Eric Finnigan: 00:39:37

Uh, but there's always opportunities, even with that, even within the

Eric Finnigan: 00:39:40

constraints that you have to express their creativity or express it,

Eric Finnigan: 00:39:45

really follow and notice what you're, Passionate about because that's going

Eric Finnigan: 00:39:49

to inform everything else later on.

Todd Miller: 00:39:51

Well, and I think you even talked a lot about some trends

Todd Miller: 00:39:54

and things that, Hey, you know, some might catch someone's interest.

Todd Miller: 00:39:57

Say, I want to hop on that and see what I can do to help that situation.

Todd Miller: 00:40:01

Um, good stuff.

Todd Miller: 00:40:03

So last time you were on the show, you were a little nervous, but you did

Todd Miller: 00:40:07

participate in our rapid fire questions.

Todd Miller: 00:40:09

Uh, we have a whole new set of rapid fire questions for you.

Todd Miller: 00:40:13

This show, are you up to it?

Todd Miller: 00:40:14

I'm still ready.

Todd Miller: 00:40:15

Very good.

Todd Miller: 00:40:16

So, um, here we go.

Todd Miller: 00:40:18

These are different questions from what you got asked before.

Todd Miller: 00:40:20

Um, and you have no idea what we're about to ask.

Todd Miller: 00:40:23

What is a product or service that you have bought or used recently

Todd Miller: 00:40:27

that was a real game changer for you?

Todd Miller: 00:40:30

Sort of a, where have you been all my life situation?

Eric Finnigan: 00:40:32

Oh yeah, this is a, this is an easy one.

Eric Finnigan: 00:40:35

I use it every day.

Eric Finnigan: 00:40:37

It costs less than 15, but it's a book light that is like

Eric Finnigan: 00:40:42

colored, it puts out red light.

Eric Finnigan: 00:40:46

So if you're reading at night, which I often do, and I'm a little bit neurotic

Eric Finnigan: 00:40:51

about not getting super bright lights in my eyes at night because of sleeping wise.

Eric Finnigan: 00:40:57

So I put this on the back of a book and it just gives you.

Eric Finnigan: 00:41:01

Great light to read at night.

Eric Finnigan: 00:41:03

Wow.

Eric Finnigan: 00:41:04

It's a game changer.

Todd Miller: 00:41:06

That is cool.

Todd Miller: 00:41:07

Good stuff.

Todd Miller: 00:41:09

Okay, question number three.

Todd Miller: 00:41:10

What is your favorite sushi roll?

Todd Miller: 00:41:13

Sushi

Eric Finnigan: 00:41:14

roll.

Eric Finnigan: 00:41:14

I love, uh, I love when they have like little crispy pieces of I guess tempura

Eric Finnigan: 00:41:20

or something on the outside of the Um, it's kind of sprinkled on top with uh,

Eric Finnigan: 00:41:25

but it's like I'm easy to please with sushi as long as it has like a salmon

Eric Finnigan: 00:41:31

or a tuna or a, uh, avocado in it.

Eric Finnigan: 00:41:35

I love sushi.

Eric Finnigan: 00:41:37

It's hard to stop eating.

Eric Finnigan: 00:41:38

It's really hard for me to stop eating sushi.

Eric Finnigan: 00:41:40

I don't know if you have that problem, but it's like, These

Eric Finnigan: 00:41:42

little bites, how do you get full on little like little pieces like that?

Eric Finnigan: 00:41:45

You just like little snacks

Todd Miller: 00:41:48

Good stuff.

Todd Miller: 00:41:48

Well, my wife and I ate at a ramen restaurant the other day and they

Todd Miller: 00:41:51

had something called a crab rangoon roll And uh, it was incredible.

Todd Miller: 00:41:56

So if you ever any place has a crab rangoon roll, you got to

Todd Miller: 00:41:59

try that one Okay, next one.

Todd Miller: 00:42:02

Who was your favorite teacher in school?

Todd Miller: 00:42:05

And what do you remember them for?

Eric Finnigan: 00:42:07

Um, I had a math teacher in 12th grade, Mr.

Eric Finnigan: 00:42:10

Tishka.

Eric Finnigan: 00:42:11

He was so excited.

Eric Finnigan: 00:42:13

He seemed really passionate about calculus and it was matching my own sort

Eric Finnigan: 00:42:18

of like interest in math at the time.

Eric Finnigan: 00:42:21

And somehow the leap from pre calc to calculus was just mind blowing to me.

Eric Finnigan: 00:42:28

It was sort of had a magical quality to it.

Eric Finnigan: 00:42:30

You went from this sort of like, Finite space.

Eric Finnigan: 00:42:33

You're adding up things, you know, these little like basically coming up

Eric Finnigan: 00:42:38

with these, you know, ways to add up a lot of things all at once to calculus,

Eric Finnigan: 00:42:42

which is like, okay, now you add up an infinite number of things all at once.

Eric Finnigan: 00:42:46

And you take the slope of a line at a point.

Eric Finnigan: 00:42:48

Like, how do you do that?

Eric Finnigan: 00:42:49

It just blew my mind.

Eric Finnigan: 00:42:51

And it had this like magical, imaginative quality to it.

Eric Finnigan: 00:42:56

And it was, he made learning it so fun.

Eric Finnigan: 00:43:00

It was also where I was like, this is something I'm passionate, I'm

Eric Finnigan: 00:43:04

passionate about this somehow.

Eric Finnigan: 00:43:05

I don't know how or why, but I'm really interested in, in, in math.

Eric Finnigan: 00:43:09

So I would say that informed a lot of what I did in college and

Eric Finnigan: 00:43:14

kind of after he, Sort of changed, changed how I think about math.

Todd Miller: 00:43:19

Good stuff.

Todd Miller: 00:43:21

I had a couple of late high school teachers who did something very

Todd Miller: 00:43:24

similar to me, but, but with words.

Todd Miller: 00:43:26

Um, yeah, calculus ended up being lost on me in the end.

Todd Miller: 00:43:29

But, um, yeah, great, great memories.

Todd Miller: 00:43:34

Uh, what?

Todd Miller: 00:43:35

Okay.

Todd Miller: 00:43:35

Next question.

Todd Miller: 00:43:36

What would you like to be remembered for at the end of your days?

Eric Finnigan: 00:43:40

I would like to be remembered for, I'd love to be remembered

Eric Finnigan: 00:43:44

as being, like, having a lot of integrity, whether that's I'm doing what I say,

Eric Finnigan: 00:43:51

like things I say I'll do, I actually do it, you know, who I am in the

Eric Finnigan: 00:43:55

world matches who I am inside, right?

Eric Finnigan: 00:43:58

Like, that you get the same person that I, Know myself to be internally that

Eric Finnigan: 00:44:04

to me is I think people can pick up on that if there's like a fundamental

Eric Finnigan: 00:44:08

congruence or incongruence between the interior and the exterior and what

Eric Finnigan: 00:44:12

someone's thinking how they're feeling versus how they're interacting with you.

Eric Finnigan: 00:44:17

I want to be remembered as like a guy who's just.

Todd Miller: 00:44:24

I love it.

Todd Miller: 00:44:24

That's great.

Todd Miller: 00:44:25

Sounds like authenticity just to a large degree.

Todd Miller: 00:44:28

Exactly.

Todd Miller: 00:44:29

Next to last question.

Todd Miller: 00:44:30

How would you describe your job to a three year old?

Eric Finnigan: 00:44:37

I would say, Hey, you see those, see those

Eric Finnigan: 00:44:41

construction workers out there.

Eric Finnigan: 00:44:43

You see those people building that house, people hammering the nails

Eric Finnigan: 00:44:46

and, uh, laying the foundation.

Eric Finnigan: 00:44:50

I help them think about how about the net about tomorrow, what

Eric Finnigan: 00:44:54

they're going to do tomorrow.

Eric Finnigan: 00:44:56

So they, they know what they're doing today.

Eric Finnigan: 00:44:57

They're, they're focused on building that house and laying that foundation.

Eric Finnigan: 00:45:01

Um, I help them decide what to do tomorrow.

Eric Finnigan: 00:45:04

Good answer.

Todd Miller: 00:45:05

Last rapid fire question.

Todd Miller: 00:45:08

Tell us a weird fact that you just happened to know.

Todd Miller: 00:45:12

I just saw this last night.

Eric Finnigan: 00:45:13

So, uh, I, so I have a fun fact is that I have a book right on my

Eric Finnigan: 00:45:21

bookshelf called 2, 201 Fascinating Facts.

Eric Finnigan: 00:45:24

It was my favorite book as a young kid.

Eric Finnigan: 00:45:27

And I don't remember anything from that book right now.

Eric Finnigan: 00:45:28

But what I remember is I read this, this fact last night that, uh, the

Eric Finnigan: 00:45:32

word helicopter, the word helicopter.

Eric Finnigan: 00:45:33

So it's these two syllables, hella, or maybe it's three, helicopter, right?

Eric Finnigan: 00:45:38

Three syllables.

Eric Finnigan: 00:45:39

And it sort of naturally splits between heli and copter, right?

Eric Finnigan: 00:45:43

But the root of it, the sort of like, etymology I think is the, yeah, the

Eric Finnigan: 00:45:48

etymology of it is, it's, The second half P T E R is its own sort of like word, so

Eric Finnigan: 00:45:56

it means sort of wing, it's like the same word of like pterodactyl, P T E R, right?

Eric Finnigan: 00:46:03

Yeah.

Eric Finnigan: 00:46:03

Yeah, so it sort of like has its own meaning to it.

Eric Finnigan: 00:46:07

And, so I, I, for some reason I thought helio was one and then copter

Eric Finnigan: 00:46:11

was the other word, but it's actually splits at P T E R, helio, helioc.

Eric Finnigan: 00:46:17

And it's

Todd Miller: 00:46:24

very interesting.

Todd Miller: 00:46:28

Thank you.

Todd Miller: 00:46:29

You're welcome.

Todd Miller: 00:46:30

Well, thank you again, Eric.

Todd Miller: 00:46:31

So why don't you remind us for folks who want to follow you?

Todd Miller: 00:46:34

Maybe I'm getting in touch with you.

Todd Miller: 00:46:35

How can they best do that?

Eric Finnigan: 00:46:37

So you can follow me on if you're on Twitter or it's X,

Eric Finnigan: 00:46:40

whatever they're calling it these days.

Eric Finnigan: 00:46:41

It's just my first and last name.

Eric Finnigan: 00:46:43

Eric Finnegan.

Eric Finnigan: 00:46:44

Um, you can find me on LinkedIn as well.

Eric Finnigan: 00:46:46

There's actually another person involved in real estate with my same exact name.

Eric Finnigan: 00:46:50

And we both have beards and we book, we look around the same age.

Eric Finnigan: 00:46:53

So it's not that person.

Eric Finnigan: 00:46:55

So it's Eric Finnegan from Colorado.

Eric Finnigan: 00:46:58

Uh, I work at, I work at John Burns Research and Consulting.

Eric Finnigan: 00:47:01

Um, you can, our, our website is jbrec.

Eric Finnigan: 00:47:05

com.

Eric Finnigan: 00:47:06

Um, you can find me there.

Eric Finnigan: 00:47:08

We have a huge team.

Eric Finnigan: 00:47:10

So anything I've talked about today is informed by a lot of

Eric Finnigan: 00:47:12

the work our team team has done.

Eric Finnigan: 00:47:15

Um, it's just a all star really set of all stars here.

Eric Finnigan: 00:47:18

So John Burris Research and Consulting, JBREC.

Eric Finnigan: 00:47:21

com.

Todd Miller: 00:47:22

Awesome.

Todd Miller: 00:47:23

I give shout outs to you folks all the time because of the

Todd Miller: 00:47:26

great information you provide.

Todd Miller: 00:47:27

It's, it's really good.

Todd Miller: 00:47:28

Fantastic.

Eric Finnigan: 00:47:29

Appreciate that, Todd.

Eric Finnigan: 00:47:30

Thank you.

Todd Miller: 00:47:31

Well, thank you again for being on the show.

Todd Miller: 00:47:32

We appreciate it.

Todd Miller: 00:47:33

We were both successful with our challenge words.

Todd Miller: 00:47:36

Um, Eric had the word maniacal.

Todd Miller: 00:47:39

Yeah.

Todd Miller: 00:47:40

It's easy for me to say maniacal, which he worked in very early on.

Todd Miller: 00:47:44

And I had the word crocodile, which I got squeezed in there eventually as well.

Todd Miller: 00:47:48

So congratulations.

Eric Finnigan: 00:47:51

Thank you.

Eric Finnigan: 00:47:52

Yes, I'm, I'm, I'm glad to have, have, have beat the challenge this time.

Eric Finnigan: 00:47:56

I totally failed the last time.

Eric Finnigan: 00:47:57

So I made sure to work it in early.

Todd Miller: 00:48:00

You did it.

Todd Miller: 00:48:01

Thank you.

Todd Miller: 00:48:01

That may have been the first time we ever did it with your previous episode.

Todd Miller: 00:48:05

I'm not even sure, but so thank you again.

Todd Miller: 00:48:07

And I'd like to thank our audience for tuning into this very special

Todd Miller: 00:48:10

episode of Construction Disruption.

Todd Miller: 00:48:12

With Eric Finnegan, F I N N I G A N of John Burns Research and Consulting.

Todd Miller: 00:48:18

Uh, look for his contact information also in the show notes for this episode.

Todd Miller: 00:48:23

So don't forget to watch for future episodes of our podcast.

Todd Miller: 00:48:26

We're always blessed with great guests.

Todd Miller: 00:48:28

Please leave a review on Apple podcasts or YouTube.

Todd Miller: 00:48:30

Um, until the next time we're together, keep on disrupting and

Todd Miller: 00:48:33

challenging and looking for new and better ways of doing things.

Todd Miller: 00:48:37

And don't forget to have a positive impact on everyone you encounter.

Todd Miller: 00:48:41

Make them smile, encourage them simple yet powerful things you can

Todd Miller: 00:48:45

do to change the world for somebody.

Todd Miller: 00:48:47

So God bless and take care.

Todd Miller: 00:48:48

This is Isaiah industry signing off until the next episode

Todd Miller: 00:48:51

of construction disruption.

Intro: 00:48:55

This podcast is produced by Isaiah industries, manufacturer of specialty

Intro: 00:49:00

metal roofing and other building products.