Tick-tock, the clock grinds away time leading to American homebuilders’ annual rite of Spring, an all-important selling season that sets the tone for their business this year, and determines – to a large extent -- whether they’ll be playing on offense or defense for a foreseeable future.

Our informal pulse check among owners, principal stakeholders, strategists, and operators on the ground amounts to a cautiously optimistic view of structural demand and favorable supply conditions. The caution tempering their optimism falls under an array of headings – interest rates, land scarcity, capital access constraints, zoning and land-use hurdles, media headline risk, etc. – and they all have one mega challenge underlining each concern: Building affordably.

Three recent headlines give homebuilders’ concerns context:

1. “The homeownership rate for householders aged less than 35 decreased to 38.1% in the fourth quarter of 2023, as affordability is declining for first-time homebuyers amidst elevated mortgage interest rates and tight housing supply. This age group, particularly sensitive to mortgage rates and the inventory of entry-level homes, saw the largest decline among all age categories.” – National Association of Home Builders’ Eye On Housing
2. "There is one large factor that is hard to measure. Is the desire among Millennials and Gen Z to own their own home still as strong as it has been in the past? Will that desire overcome the higher interest rate environment, higher home prices and the scarcity of inventory to move the level of homebuying back to historical averages? HousingWire
3. "In the U.S., 60% of millennials say they would wave goodbye to the traditional American dream of hard work and big salaries, opting to exchange a chunk of their income for a slower-paced life." Fortune

A fourth headline, from within the past couple of weeks, asks: “Is This Really ‘the Worst Time to Buy a Home’?”

Still, what encourages new-home development and construction business leaders as they ready their new neighborhoods, websites, and operations for Spring Selling is an ongoing, vast, all-too-evident need, particularly among young adult households in the formative years of their careers, families, and lifestyles, for homeownership options. What’s more, it’s clear that existing home choices – historically, a leading option – can’t and won’t likely meet that need since so many of those homeowners are “locked-in” to mortgages with rates well below the current higher-for-longer rate regime.

Uncertainties and volatility being what they are, homebuilders and their business partners have learned that they’re going to “bring their A Game” to the challenge of igniting “desire among Millennials and GenZ to own their own home.”

An essential piece of that “A Game” is simplicity. Simplicity – in what’s long been regarded as a taxing, confusing, and mystifying home purchase rigamarole, full of moving parts and hidden pitfalls – means “no surprises.” That’s why many builders have taken to integrating as many of the shopping and purchase experience pieces and processes into a less daunting, more clearly transparent and predictable flow of steps, decisions, and – importantly – financial action items. A well-known example of this purchase process streamlining became widespread years ago, as homebuilders aligned with captive mortgage lenders and title insurance firms as a simplification solution for homebuyers. A similar approach – for homeowners insurance – is catching on just as younger-adult homebuyers demand a more friction-free shopping and buying process that matches their experience as digital-native consumers in every other facet of their lives.

We try to get insurance taken care of from the very beginning, so it's not a last-minute ordeal,” says Arvin Darilag, VP of Business Development at Westwood Insurance Agency, a supporting partner of The Builder’s Daily. “We integrate with homebuilders the very moment a new community comes online, providing insurance quotes for each floor plan.”

Before “embedded” insurance, Darilag tells us, that process simplification was far from typical. Instead, first-time homebuyers tended to take care of insurance at the very last minute. When they did it that way, and a lender partner or in-house lender for the home builder prepared for closing, the question arose: “Do you have insurance in place?” At that point, a homebuyer responds: “No, let me get a quote.” Getting a quote takes time, especially in this high-stress moment of trying to close. On average, insurance companies might ask 30 questions before they provide a homebuyer a quote. Now in a rush to get a quote, homebuyers reflexively get one quote and submit that to their lender.

The way we embed insurance is that from the moment a homebuyer walks into a homebuilder’s community to look at all the different floor plans, we make it so that their insurance quotes are already set and available,” says Westwood’s Darilag. “The quotes we provide are available to every homebuyer. In turn, the homebuilder knows that the quote represents the price their homebuyer will pay. On top of that, we provide our builder clients a portal for their lending teams so they can quickly access those quotes and request the policy.”

What’s more, a relatively recent and menacing factor – climate turbulence and massively destructive natural hazards that have become more commonplace in the past 10 years or so – amplifies the practical urgency for this level of simplicity and predictability in a homebuyer’s journey to closing.

Being in business for over 70 years, we have a lot of insurance company partnerships,” Westwood’s Arvin Darilag tells us. “We work with over 40 A-rated carriers. That allows us to provide products in tough-to-insure markets. And because of this simplicity, our capture rate has actually improved in California, Texas, and Florida. That’s the driving reason why many of our newer clients rely on Westwood: To help their homebuyers navigate the tough insurance market. Builders see that their homebuyers are getting extremely high quotes, some that don't even allow them to qualify for the loan. Having Westwood as part of their process gives these builders peace of mind that their homebuyers will find insurance for the home they choose.”