Mr. Morris,
With all due respect, it is incredibly cynical to blame the AIA for us gravitating to a small pool of the wealthiest clients. I haven't seen any commercials on TV displaying us as an elitist group that will only provide services for those who are deemed "good enough". In fact, the average person simply doesn't know we exist in the context that directly affects their lives because our typical business models don't include them. The AIA isn't promoting this attitude, we are. It's not the AIA's fault that we choose to do business the way we do. General Contractors do hire us when we are business savvy enough to figure out how to fit in their business models and not insist that they conform to ours. The problem is simple and it has nothing to do with the AIA or the Builders screwing us.
The vast majority of the money being made in the building industry is not in commercial buildings or homes for the wealthy. The biggest piece of the pie is in housing for people in the 98%. We choose to turn our noses up to this work. We choose not to get involved in speculative housing, which accounts for over 80% of all houses being built. One of our own once said, "Less is More." I've made a lucrative business as a sole proprietor thinking along those lines while providing good design to the people not included in the standard Architect's business model. Insisting that average home owners and home builders pay 5 figures for a set of extremely detailed drawings is only going to price YOU out of their realm of affordability. Houses for 98% of Americans do NOT require that high of a level of documentation. You can provide good design to these people if you simply do less. When we bundle many services into a project, we're expected to give a little discount for that bigger fee. This diminishes your dollars per hour from the beginning. When we provide just what is needed we can charge the minimum set up fee or the most $$$/hr. The total fee may be less, but the amount of time spent to make that dollar is much less when you don't bundle your services for a discount. A home builder can build from a napkin sketch. The building officials only require so much information, so only provide what each needs and you can find your fee becoming affordable to many more people. This paranoid notion that we must over document a project to protect ourselves has often been the root of lawsuits against us. How many spec books in conflict with the drawings have bit us in the butt? The more information you provide a lawyer to analyze, the more they find to nail you with. Sometimes LESS IS MORE!
98% of Americans make $250K or less. These people require loans for the maximum amount of financing to build a house, which is typically 80% of the value of the proposed design. When we're used to working for the other 2%, we don't have to worry about how the bank arrives at that value number because these clients can pay for all or most of the construction cost without financing. Appraisals are the root cause of why we exclude ourselves from the majority of the most lucrative sector of the building industry. An Appraisal is a certified value and the bank cannot lend money without a certified value for the project. The way appraisals are typically done in this country is to simply average the recent sales in the area. There is little regard to the quality differences of the houses, as the location is the most important aspect. New houses are valued at the highest rate per sf and the only house that can register as a new sale is a speculative house. The cheapest made, worst designed houses in America are driving the values in YOUR area. When one of our more expensive, better designed houses are compared as equals to the houses that just sold as NEW, because they exist in the same location, our projects seem overpriced and not valuable. How many people would pay current rates for a BMW or Gucci purse if they were valued as equals to their lesser priced, cheaper made knock offs? People will pay lots of money for ugly things if these things are considered valuable. It doesn't work the other way around.
If we paid market price for the land, this would account for the mysterious cost of being in one location or another. We could then see what people are willing to pay for the site made product itself. A cheap made box would no longer be viewed as the same thing as a more desirable, better designed, better built house just because they happen to sit side by side. We could compare our work to our work no matter where it sits and the builder box guys would have to accept the value of what they are really building, not using our better sales history to give themselves a pay raise. Appraisal Reform is the most important key to us getting involved in the majority of buildings being built in this country, the average house. If we fix this, we will become valuable to everyone. Right now design doesn't matter because there is no way to track how much people are willing to pay for better design. The value system is rigged against us, not the AIA or Builders.
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Eric Rawlings AIA
Owner
Rawlings Design, Inc.
Decatur GA
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