The Housing Chronicles Blog: Do builders need to re-learn PR 101?

Thursday, June 12, 2008

Do builders need to re-learn PR 101?

A couple of months ago, I had what I thought was a great idea for a story for the real estate section of the Los Angeles Times: helping their readers negotiate the maze of builder incentives being offered at new home communities including upgrades at design centers, payment of closing costs, interest rate buy-downs or even pricing discounts. There's even a website,, that helps consumers pick their homes based on incentives (not a great idea, in my opinion, since that could mean buyers buy a home they hate but loved the incentive).

Having written a few book reviews and articles for the paper since January, the Times editor was already comfortable with my writing style and agreed that my background in the building industry would be an asset. She even assigned me a homebuyer to interview, who had recently used incentives to buy two new homes at communities in Orange County built by two large builders in Southern California.

"Great!" I thought. "Good, solid companies -- they'll love the chance to tell their side to someone from the industry who wants to write a balanced article."

The buyer told me his story (which ultimately turned out to be positive since he got what he wanted), and afterwards I contacted both homebuilders to comment, thinking I'd get to someone right away or at least a return phone call within a day or two.

I told them that if the story, once published, is re-purposed to other Tribune-owned properties such as the Chicago Tribune, Baltimore Sun and Newsday, that the story could ultimately be seen by up to 3.5 million readers, so this would be a great opportunity for them to explain to potential buyers how and why they use incentives, including sometimes tying incentives to using in-house lenders, how they figure out the total value of a home, what kind of mark-ups are typical at a design center, how a buyer's agent can participate in the process and get a commission, if the incentives make a new home a better deal than a resale, etc. -- in other words, all the things that I'd want to know when shopping for a new home and what questions to ask.

And what have they said so far?


First, I got shuffled to one person, and then another, and then another. I'm still waiting for a call from a Division President -- perhaps he's busy, but c'mon, THAT busy?

So far, no returned phone calls, no returned emails, and I've been going at this for two weeks.

I can't imagine ever just ignoring a phone call from a reporter for a major daily or a business publication -- while giving a speech a couple of weeks ago, I forgot to shut my cellphone off, and it was a reporter from the Financial Times asking about -- surprise -- builder incentives, and I called him back as soon as I was done. Even if I can't answer the question, I still return the call in order to build the relationship so they'll call me in the future and view me as a reliable source.

My editor says builders are notoriously difficult about commenting to the press about anything (something that's been verified by reporters at other papers). That, of course, reminded me of the PR debacles of WorldCom and Enron, when refusing to comment ultimately meant that they were hiding something, such as billions in write-downs and falsified revenue statements.

While that's certainly not the case for this story, it does beg a question: do builders need to re-learn PR 101? Many of them hire PR agencies on retainer -- but isn't that simply wasted money if they ignore opportunities such as this? I feel sorry for PR people who are ordered to ignore phone calls, because I'm sure that's not what they thought their days would be like when they chose the vocation.

So, until I hear back from either of these large builders, the next time one complains to me about media coverage of new home sales, I think I'm going to tell them this story and ask them to consider just much of the PR damage has been self-inflicted due to simple lapses of common sense -- you know, the same kind that led to purchases of hyper-inflated land.

If I do hear back from either of them soon, I thank them in advance for helping me to write a well-rounded article. Either way, look for it to be published on Sunday, July 6th!

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