Preventive Home Maintenance Targeted At Professionals, Owners Of Second Homes

PALO ALTO | Thursday, December 15, 2005

Requests from custom-home clients convinced Jim Murphy & Associates (JMA) to start a subsidiary to help busy or absentee homeowners with upkeep of their high-end homes. The builder plans to launch a Sonoma County franchise of Home Preservation Services in late May or early June, according to Dayna Shamrock, who will lead the endeavor. The subsidiary, called HPS-Sonoma County, will field two-worker teams who will visit customer homes quarterly to perform preventive maintenance. The service will start with one van and a journeyman carpenter and an experienced apprentice. It is envisioned to expand over five years to five teams serving 1,000 customers in the county. Teams will visit customer homes quarterly to perform minor preventive maintenance, document problems, and recommend repairs to be done by subcontractors.

They’ll be following a 260-point customized program developed by Central Point, Oregon-based Home Preservation Services (HPS). JMA will be the third construction-company to acquire an HPS franchise. The initial franchise is in Palo Alto, and the second one is in Louisville, Kentucky. A Novato-based company is considering a Marin-County franchise, as are other prospects in the East Bay, according to HPS chairman and founder Steve Spratt. He is targeting 150 markets nationwide.

Reasonable Cost JMA has built about 60 $2 million-plus custom homes in the past two decades. For the past several years, the builder has been receiving an increasing number of requests for Maintenance work and has been looking for a more efficient way to respond to the requests, according to president Jim Murphy. At the same time, JMA has been pursuing ways to do more work for its existing clientele, rather than reaching increasingly farther from its Santa Rosa base of operations to find work in recession.

Discussions with a dozen past and present clients about interest in the new service have garnered as many prospective customers, according to Mr. Murphy. A focused marketing effort is planned for later this month.

“Ten to 15 years ago, this service probably wouldn’t have gone anywhere. But everything in a house such as thermostats and climate control is getting more complicated, and people are getting busier,” Mr. Murphy says.

The cost for the service runs .25/sf for the initial inspection plus an average of $1/sf/year for quarterly visits, not including emergency calls. Service contracts have two-year terms. For a 6,000sf home that’s $6,000 a year on the average.

If that seems high, consider that homeowners are advised to budget .75% of a home’s value annually for maintenance for homes less than 10 years old, according to the American Society of Home Inspectors. That jumps to 1.5% annually for homes in their second decade and 3.0% in the third decade. For a $2 million home, that’s a $15,000 a year set aside for maintenance if it’s new, $30,000 a year if it’s a dozen years old, and $60,000 if it’s over 20 years old.

Basis for Demand Charlie Carson, executive director of the Northern Division of the Home Builders Association of Northern California, says such a service could catch on for homeowners willing to pay to save time for other pursuits, especially with growing concerns about mold and construction defects. Homes today are increasingly more airtight, so having an outside party checking the home regularly for leaks that could cause excessive moisture would be helpful to stave off mold and dry rot, he says.

Also, a continuing point of contention in the boiling construction-defect litigation debate is determining what is a defect and what is deferred maintenance, he adds.

“We never like to equate our industry with auto industry, but [JMA’s new service] is a lot like getting a vehicle on a schedule for maintenance,” Mr. Carson says. “The structure of a home will remain for a long time, but the parts inside won’t.” Paul DeLuca Sr. of Restoration Certified Specialists says the proactive approach of HPS-Sonoma County, rather than the reaction to litigation, is where the industry is headed. As evidence, his company has just launched a service for monitoring moisture levels during construction and providing contractors with certification documentation about moisture prevention. He is also offering the service for homeowners.

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