Homes with Heart
In under three years, Hudson Homes has gone from a small building and construction start-up to a major player in the Sydney region.
As with many businesses, the idea for Hudson Homes came from seeing a gap in the market and realising that there was a need to fill it. CEO and founder of Hudson Homes, Danny Assabgy, saw a gap in the housing market for good-quality house and land packages and decided that he was going to fill it. It proved extremely successful, and only two and a half years later the company has won a number of awards, grown substantially, and ranked number one in BRW’s ‘Fast Starters’ list for 2015.
“The company started off with a really good business plan,” Danny explains. “There’s a major builder in Victoria that has been around for 60-odd years. About five years ago, I presented them with an idea to set up a new division which specialised in bringing high-quality, owner-occupied homes to the investment market.”
This idea came from Danny’s experience in the property and finance industries. He studied accounting and law at university, and began his career working for an accountancy firm that specialised in insolvency, then moving into the business, real estate, and financial planning sectors. “I think that those first four years of working in the insolvency world gave me a really good understanding of what not to do in business, and I’ve applied those rules into every business I have run ever since,” Danny says.
“A lot of my background in financial planning started with property investment. What I found was that, unfortunately, a lot of the real estate products that were recommended to investors were inferior products, whereas the better quality products were going to mums and dads as owner–occupiers. So, five years ago, I came up with this concept working with Simonds Homes, and we started a 50:50 JV partnership called Simonds Direct that enabled investors to deal directly with the home builder, thus eliminating the middleman. That provided owner-occupied quality homes in good growth areas to the investment market, and that strategy was incredibly successful.
“Two years into it, they bought out my 50-per-cent share of that business, and two years after that I applied the same concept to Hudson Homes. Hudson Homes has designed a range of very good-quality, owner–occupier level homes that we made available, with the right level of inclusions, to the investment community. And that’s what gave us our initial growth until we were able to secure some display homes in various regions.”
There were a number of challenges for Danny, however. The industry is very competitive, so it took a lot for Hudson Homes to push through and be successful. “I believe in this industry. Our competitors do a really good job. They have been around for a very long time, they have a quality product, and they present it extremely well. So our first challenge was designing the product and presenting it in a way that matched the level of our competitors.
“That was our first challenge, being able to compete in a market that’s very well established and already does an amazing job. Our second challenge was going out there and getting land upon which to build these homes. The Sydney market has been performing extremely well over the past two years, so getting land was quite difficult and we had to come up with creative ways to overcome that.”
This demand for land and rising house prices was also something Danny saw as having a negative impact, as it was pushing first-home buyers out of the market. So he devised a program to set Hudson Homes apart from some of its competitors, while enabling everyday people to enter the property market. “I think price is a huge barrier to entry for first-time buyers,” Danny says. “We’re talking about the median price in Sydney that’s almost a million dollars now, and that makes it very hard for people to get started. We recognised that very early on in the piece, so we developed the ‘Help Me Get Started’ program.
“With this program, we’re helping genuine first-time buyers get started to buy their first home. Because I have a very strong finance background and a very good knowledge of the building industry, we were able to combine that and develop product that enabled the genuine first-home buyer, with as little as a AU$2,000 deposit, to get into their first home. It gets them out of the rent cycle and into home ownership. That product has been extremely successful and has certainly contributed to our growth over the past two years.”
Hudson Homes is extremely customer-centric, with programs like Help Me Get Started and a large team of staff who are committed to customer service. The company has also invested in a number of technology advancements to provide even better customer service, while automating processes and keeping costs down. “I think technology is a really important aspect in all industries, and even in the building and construction industry,” Danny explains. “We developed an online portal that enabled referring partners such as accountants, real estate agents, and financial advisers to access our property stock list and do so in an electronic format.
“So what they can do is log into our portal and download all the documentation required to present that property to their client without ever having to meet any of our people. That means that we can deliver our homes much more cost-effectively than a lot of our competitors, and that’s been a real key to our growth, particularly in the beginning. But we also apply technology in various other areas of our business; for example, we have been working on, and still continue to work on, a workflow management system within our company that enables us to automate every process from pre-construction right through to beyond the handover of the home with our maintenance program.”
This customer-centric approach really is what sets Hudson Homes apart, and is summarised by what Danny describes as the key value of the business. “From the very beginning,” Danny says, “we have had an attitude here which I call ‘whatever, whenever’, and every single one of our staff is instilled with that philosophy. What that means is that we will do whatever we need to do whenever we need to do it to satisfy our customers’ requests and demands. When you give staff the authority to make those decisions, you find that your level of customer service is exceptionally high.”
Published March 2016, CEO Magazine