Why are Rausch Coleman houses so cheap? Is it because they don't have gas?
"In northwest Arkansas, most of the houses this company offers do cost about 90 - 110 dollars per square foot.  The exceptions use the Whitney plan, which has the following design features (and/or problems) which happen to save the builder a lot of money: One very nice feature is the U-shaped stairway in the center of the house.  It is easy to find, and has an angled landing.  It might be a bit narrow, though. Does the builder bother to put rebar in the brickwork?  Arkansas is in earthquake country. What are the floors like?  Is the first floor a slab concrete floor with vinyl flooring (and/or carpet on thin pad) immediately above the concrete?  Is the second floor bouncy, due to using long-span joists of code-minimum size? Does the builder bother to make the rear windows look as nice as the front windows?  As mentioned earlier, the builder only bothers to have one side window. Where to learn more: Fernando Pagés Ruiz is a Nebraska homebuilder who wrote a book on Building the Affordable House: Trade Secrets for High-Value, Low-Cost Construction (The Taunton Press, 2005).  He has also written many articles in Fine Homebuilding, including ""Building Affordable Houses"". True North Consulting specializes in helping builders eliminate waste and ""value-engineer"" their designs.  True North often works with Tim Garrison, the self-proclaimed ""builder's engineer""." A 25% variance in price, in most markets, isn't so crazy as to require it be some sort of terrible scam, but that doesn't mean much else. It could be the inclusion of floor plans that are carefully designed to add square footage at minimum cost and thus reduce the average cost per square foot without actually being cheaper otherwise, less insulation, thinner walls, cheap piping, minimized wiring, or they are just efficient and competitive. As you pointed out they don't have gas, so that's certainly one way you know they cut costs - no gas lines to install! As the article from NAHB: Cost of Constructing A Home points out, though, what this figure includes can vary. Does it include the finished lot? If so then a smaller lot would mean lower square footage building price - because the land is smaller and cheaper, not the house!  Is any kind of financing quoted in the price? Compare also change-plan costs, any penalties for delays in construction, grade of materials, floor plans, customization costs, fees or premiums to pick colors/floors/counters/cabinets/fixtures, and so on. What about central cooling and heating - are they quoting an electric furnace? How does electrical heating in your area compare to the cost of gas heat? (relative pricing of electric and gas vary widely by region and climate) In short: often square footage price isn't the whole story of what it would cost to construct a home. Ensure you are comparing everything that's important to you and you are getting a full quote, not comparing small isolate sales-pitch figures with no clear details. If it turns out the price is 25% lower than other builders in your area and they give you what you are wanting, and you have the good sense to have a qualified home inspector and/or structural engineer inspect the home thoroughly before you take possession, then you might just have found a good builder! I'd encourage you to personally visit some of their past construction work, such as houses they build 2-10 years ago and ensure they are in the sort of condition you'd expect. I am a realtor and work for Rausch Coleman and can answer this question for you. We are a production builder. We build in communities with typically 5-9 Floorplan options per community and a select set of option and finishes that we offer. Because of the set options, we buy the materials in bulk and are able to receive cost savings on that from our suppliers which we can pass on to you. We use the same trades consistently through out our division which means they have our plans and process down to a science. They know the product, which means less likely to make mistakes and less likely to miss things. Our heart is affordability in that we understand that not everyone can afford granite, gas, hardwood floors, etc. so we allow you to be able to customize your monthly payment, and that you are not financing something you may not want or need or to allow you to get in to a home you may not be able to afford otherwise. We work a lot with the first time buyer and we want to provide the best quality for the best value. We start our homes at a base model and allow you to customize the way you want (adding granite, gas, hardwoods, fireplace, etc.) and in doing that we allow you to choose whether you want to pay $90 or $101 per square foot or whatever that may be. I can tell you in Northwest Arkansas we are the best value and the quality shows. I pull comps consistently and in fact have another builder in the same community as I sell in. Our homes in this community for single stories is about $88-$95 and two story homes are on average $78-$86.  Two stories are more cost efficient in that the square footage goes up and not out so there is less concrete, which is one of the most expensive parts of the homebuilding process. This other builder consistently sells their homes for $101-$105 per square foot, and uses the exact same materials we do. The difference? Yes granite and hardwoods and gas and custom cabinets come standard, you have no choice in that. Would you rather have the option for a lower priced home if you didn't want granite? Or if you'd rather have carpet? We build in 5 different markets over 4 states and are in our 61st year of business. I'd love to meet with you and can walk you through a community and show you our homes (at all stages of construction) where you can see the product and quality in our homes. I am in our Dixieland Crossing community here in Northwest Arkansas. You can check out our website for other information at www.rauschcoleman.com The reason Rausch Coleman homes are generally cheaper, is because they are a high volume dealer. Their communities usually have 5 to 7 floor plan options only. They get exceptional deals on their materials because of the volume of material bought. They have it down to a science when it comes to the numbers. As far as the quality of their homes, I cant answer that. I have never been in one or known of anyone that has bought one. Not only are they high volume but also most finish materials are very basic. For example lighting fixtures, most builders put ceiling fans in all bedrooms ($75) where Rausch coleman uses a flush mount ($15) in the spare bedrooms.  Same with flooring they use a vinyl plank where most builders use wood. This can be $1sqft or more cheaper. Cabinets, carpet, tile, countertops, faucets, all they same. These are all cosmetics and you can save a ton of money while building by doing this and still build a quality home. Rausch Coleman builds a quality home at an affordable price by keeping the cosmetics basic. They are cheap because they are made from cheap material.  All the homes in my addition are Ruasch Coleman and a lot of them are having issues (Oklahoma).  Several are around 5 years old and have already had to get new roofs.  On our neighborhood FB page there have been complaints with the plumbing system and flooding in yards that weren't leveled properly once the ground settled.  I know I regret my purchase.  You get what you pay for. Research the company that is all I can say this company has horrible reviews. They show on their Facebook page great reviews but if you really look through all reviews the high ratings are from past and current employees. All other reviews from actual home owners are bad. They make a lot of false promises and build very cheap homes that will not last without several costly problems within the near future. Most people that buy one of their houses sell it within a few years because they start having so many problems. They have outside vendors doing all the work and do not make these vendors very accountable. I know I was a manager with Rausch for several years. STAY AWAY! I have lived in my RC Home since 2008 and I have had ZERO PROBLEMS! We are in the process of building another RC home in a different community. The only thing I've done was replace the roof ONLY because of a very bad hail storm (baseball sized) that came through OKC. My mom also purchased a RC home in 2007 and didn't have any problems. What buyers have to do is be involved the whole time before, during, and after the build. Take lots of pictures of the entire process if you can. We went by our build daily (we didn't live that far), but if you can go by your build at least once a week, it helps. During my inspection, there was a hairline crack in the baseboard and it was corrected immediately. If you have a good inspector and sales rep that genuinely cares, you will be just fine and will love your home. Good Job RC HOMES! I walked into my sister's new Rausch Coleman house this afternoon to help her move in and told her to make sure that they put on the hot water heater room door in the garage on when they come back to take care of the final touch ups. I also said and don't let them forget to paint the garage because I noticed while driving through her neighborhood that everyone had taped and mudded garages but no paint. She told me that Rausch Coleman was not coming back to do any touch ups. I said what about this stuff?!?!!!!! My sister said the house does not come with a door for the hot water heater or the garage being painted. Are you SERIOUS?????? That's like not putting the covers on your electrical outlets...your kidding me that this does not come in the base package. Shame on you Raush Coleman. Your prices are not that cheap to not include that. That is what I call bad customer service and ripping off your clients. The paint job is hideous. Let's just say my 9 year old could do a better job than that. The mirrors in her bathrooms are not hung centered and is so obvious.  She went to open her dishwasher and it came out of the hole because it was never anchored down.  I could go on and on!!!!!! Do not use this builder!!!!!!!
I don't know why stocks in some industries tend to have lower prices per share than others. It doesn't really matter much. Whether a company has 1,000,0000 shares selling for $100 each, or 10,000,000 shares selling for $10 each, either way the total value is the same. Companies generally like to keep the share price relatively low so that if someone wants to buy a small amount, they can. Like if the price was $10,000 per share, than an investor with less than $10,000 to put in that one stock would be priced out of the market. If it's $10, then if someone wants $10 they can buy one share, and if someone wants $10,000 they can buy 1000 shares. As to why energy stocks are volatile, I can think of several reasons. One, in our current world, energy is highly susceptible to politics. A lot of the world's energy comes from the Middle East, which is a notoriously unstable region. Any time there's conflict there, energy supplies from the region become uncertain. Oil-producing countries may embargo countries that they don't like. A war will, at the very least, interfere with transportation and shipping, and may result in oil wells being destroyed. Etc. Two, energy is consumed when you use it, and most consumers have very limited ability to stockpile. So you're constantly buying the energy you need as you need it. So if demand goes down, it is reflected immediately. Compare this to, say, clothing. Most people expect to keep the same clothes for years, wearing them repeatedly. (Hopefully washing them now and then!) So if for some reason you decided today that you only need three red shirts instead of four, this might not have any immediate impact on your buying. It could be months before you would have bought a new red shirt anyway. There is a tendency for the market to react rather slowly to changes in demand for shirts. But with energy, if you decide you only need to burn 3 gallons of gas per week instead of 4, your consumption goes down immediately, within days. Three, really adding to number two, energy is highly perishable, especially some forms of energy. If a solar power station is capable of producing 10 megawatts but today there is only demand for 9 megawatts, you can't save the unused megawatt for some future time when demand is higher. It's gone. (You can charge a battery with it, but that's pretty limited.) You can pile up coal or store natural gas in a tank until you need it, but you can't save the output of a power plant. Note numbers two and three also apply to food, which is why food production is also very volatile. "What do you mean ""Not Coming Back""? It seems to be coming back to 1990 prices, but not fast enough. I'd love to see it come back to 1970 prices.  I don't understand it when people say that ""Housing"" is not improving, when prices go lower. When gas is cheaper, as far as my budget is concerned, it's improving! When food is cheaper, it's also improving! Of course, this is assuming it's really cheaper and not some artifact of unhealthy bioengineering, war, or simply costing ""fewer US dollars"" due to fiscal manipulation. Housing improves when prices go down, because it improves my chances of being able to afford one.  If lower prices are caused by demographics, student debt, and no jobs - I say, it can't come soon enough. I want it!" Point being, the problem hasn't been fixed. The deficit went from enormous in 2009 to simply large today.  It's never going to be paid back.  The main issue to consider is that today the United States is the third largest oil producer in the world and the largest natural gas producer, thanks to hydraulic fracturing most of this surge happened during the Obama administration, spurred on by relatively high energy prices.  [Without the fracking boom, the US economy would still be considered in a recession:](http://economics21.org/commentary/oil-and-gas-boom-propels-gdp)  &gt;Without the $300-$400 billion yearly increase in output from oil and gas production, economy growth would still be negative. Manhattan Institute senior fellow Mark Mills shows the extent these industries have contributed to U.S. growth in his new report, “Where the Jobs are: Small Businesses Unleash Energy Employment Boom.”  The US manufacturing sector also benefits from this indirectly, as low energy costs thanks to suddenly abundant natural gas keeps domestic production affordable. Without the fracking boom, the US economy would be in a European type situation. [In fact, European companies move their manufacturing capacity to the US, citing low American gas prices.](http://www.ibtimes.com/natural-gas-boom-attracting-manufacturing-us-overseas-take-advantage-cheaper-fuel-1582512)  The problem with all of this is that we know that fracking is not sustainable. It depends on very high oil prices, which consumers simply can't afford to continue paying. Without oil prices rising, the industry is forced to enter further and further into debt. Part of the reason oil prices are so high in the first place right now is because of speculative traders, who expect oil prices to rise higher in the future, which is unlikely to happen.  When Obama claimed that there is 100 years worth of natural gas in the US, he was wrong. If he really believes that story himself, it's going to lead him to take bad decisions, by basing an economy on hypothetical cheap energy that won't be there in the future. The GDP contribution by the fracking industry is going to evaporate, at which point you're left with a massive debt you can't pay back. Just looking at CONED, [here is gas](https://www.coned.com/_external/cerates/documents/average_monthly_gas_bills.pdf) and [here is electric](https://www.coned.com/-/media/files/coned/documents/accountandbilling/about-your-bill-rates/average_monthly_electric_bills.pdf).   You'll have to forgive me -- when it comes to NY, I'm more familiar with gas and with residential rates, so what I said doesn't hold true across the board for electric commercial customers.   For residential electric, starting in 2009, delivery started outpacing commodity charges; by 2015 (not sure why they haven't posted 2016 data yet), $29 worth of electricity cost you $49 in delivery charges. For residential gas, the flip occurred in 2010 and was much more significant -- in 2016, a customer whose bill is just over $100 paid $75 for delivery and $25 for the actual gas (part of that is that gas prices are low, part of it is that delivery costs have gone up nearly 50%).   Each utility is different, so the [gas info is here](http://www3.dps.ny.gov/W/PSCWeb.nsf/All/85297E80413DBEDB852581A6006261BE?OpenDocument) and the [electric info is here](http://www3.dps.ny.gov/W/PSCWeb.nsf/ArticlesByTitle/0B9E6D4CE48E09EE852578570055E27B?OpenDocument) if you're interested.   I'm not sure about primers -- I haven't really looked for them -- but I know that many companies and brokers do have some materials on their websites.  For electricity in particular, I'm much more familiar with Texas than New York, but a lot of the principles are the same: look at your bills and make sure you understand all the charges and what your usage/demand is (especially over the course of a year), look up the [utility tariff](http://www3.dps.ny.gov/W/PSCWeb.nsf/ArticlesByTitle/1ABA5E2E4E08F72585257687006F3AB1?OpenDocument), and make sure everything lines up.  I harp on demand charges (a charge based on your peak energy usage during any set interval of time -- 15 minutes in TX, not sure about NY) because that's where commercial customers can get stuck paying really high charges. Big solar fan here. I like your argument for nuclear. With the way that electricity power generation works, we need ideally 3 sources of power. Nuclear is one of them. Base load, if you will.  Solar and nat gas can sort of fluctuate against each other as the sunlight changes. And once battery tech updates we can do away with nat gas.   I don't know enough about price/economics on nuclear and if you have a few concise things to share I'd appreciate it. Not asking for you to type a tome. I can always research later but appreciate your input! Unfortunately many millenials are stuck in this housing catch 22 where (for various reasons) they can't save up enough money to buy a home and since so many of them can't buy homes, they have to rent, which raises rent prices, which makes it even more difficult to save up for a home. That's because no one else is much building homes at this time, at least not at any scale.   My guess - and that's all it is - is that many capital intense businesses in the US are waiting to see if Obama gets kicked out this Fall.  If he does, I think we will see forward capital investment.  If he does not, I'd expect 4 more years of crummy economic news. "... so you don't want to know about a gas leak in a building if that leak hasn't caused the building to explode for the last 6 years?   And when he is talking ""explosion"" he's not talking the once every 10 year recession.  He's talking 1929, 1937, 1945 ... and specifically says bigger than, say, 1974 or 2008.  Where are you getting the ""10 year"" crap?  Seriously ... is that what you're saying?  Or are you saying that you just don't believe there is a gas leak?  I'm addressing the former.  The ""ignition source"" will probably not be within the US (unless long term bond yields increase substantially).  The ""ignition source"" will be from a recession in China or from Japanese yields increasing (from ""currency risk"" or ""default risk"")  -- the Japanese crisis has been 20 years in the making ( http://www.telegraph.co.uk/business/2016/04/11/olivier-blanchard-eyes-ugly-end-game-for-japan-on-debt-spiral/  ).  However, with the current Debt/GDP of Japan and the structure of Chinese total debt (govt + corporate + personal) ... and the recognition that these are the top two GDP's in the world ... the dangers for the world are undeniably larger than ever."