The HGTV Effect and Construction Lending
The surge in popularity of reality renovation shows has inspired many homeowners to look at their houses in a new way — namely as a project they can beautify themselves. Home buyers are looking for houses that look like they do on TV, with modern layouts and updated features. Combine that with record-low home inventory, and the result is more people choosing to update their current homes instead of looking for something new.
Call it media manipulation or call it creative inspiration, the HGTV Effect has made its impact on the construction lending world. More owners are renovating houses themselves, taking an interest in construction loans for the first time. Suddenly, construction lending is mainstream.
Lenders have to keep up with this new reality, as construction lending reaches a new customer segment and the customer service expectations they bring with them. For too many lenders and borrowers, the construction lending process can feel like a black box with very little transparency. (Remember, we can now watch our delivery pizza as it’s made in real-time.) Outdated, opaque loan management processes will quickly make for unhappy clients.
We believe technology can solve many of the challenges caused by analog processes — allowing for borrowers, lenders and third-parties to collaborate together. The bottom line is that construction lending doesn’t have to be a black box for anyone involved. Together, we can make things safe and simple.
Watch Built CEO Chase Gilbert talk about the HGTV Effect and how technology can change the game in construction lending: