Who doesn’t love a good “rising from the ashes” story? We certainly like to hear when a builder has dug out from a financial hole, puts the bootstraps on and gets back to work.

Last month, a U.S. Bankruptcy Court judge approved the confirmation plan of one of the largest homebuilders in the northwest, Pacific Lifestyle Homes. The approval culminates a successful reorganization of the company under Chapter 11 of the federal bankruptcy code. Pacific Lifestyles voluntarily entered Chapter 11 protection in October 2008 following the national downturn in the new-home construction and real estate markets. Since the filing, the company has been steadily restructuring its obligations while continuing to build and sell homes.

And build they have. A recent stop at the builder’s Songbird development in Vancouver, WA, revealed some completed homes, some lived in and some still under construction. Strategically located near some of the area’s best schools, the homes in the development offer all the amenities one would expect but also offer exceptional floor plans, with every inch of the home used for something—nothing is wasted. From the corner pantry in the kitchen to the upstairs common area to the convenient laundry room and decent square footage, the development has been briskly selling and might even be sold out by the time you read this.

The homebuilder has also very smartly been buying distressed land around the Portland, OR, metro area. Working with lenders and developers to help them work through their lot inventories, they’re poring over proposals from financial institutions and developers looking to unload distressed lot inventory. “I’m excited about the opportunities of the current market in terms of lot availability and affordability. I think we can provide a solution for banks and developers who need to sell inventory,” says owner and president Kevin Wann.

It’s that kind of forward thinking that makes this industry one of the most interesting and challenging, but one that can be profitable. Case in point: luxury remodeling and homeowners willing to shell out big bucks for more than a mere, mortal re-do. We’re talking expensive appliances, lavish designs and jaw-dropping results. What is this, 2004? Not quite.
According to a new survey by Pam Danziger at Unity Marketing, the market for luxury homes and the remodeling of those homes is strong right now. A majority of “affluents” surveyed (52%) were involved in a major home remodeling or decorating project in 2009 or the first half of 2010 and spent on average 40% more than home remodelers surveyed in 2008. What’s even more compelling is that an equal percentage of those surveyed plan to make home changes in the second half of 2010 and through 2011. That’s welcome news for remodelers and the many builders who are doing more remodeling work these days.

Jeff Gunderson spoke with a couple of high-end remodeling and design firms, and the theme seems to be that though homeowners are being more selective and frugal about the products they choose, they’re expecting more from a remodel and have no problem paying for the luxury. The downside is that many homeowners are staying put and not moving up to larger homes.
“Only two years ago, 60% of our business represented clients who had just bought a home and wanted to do upgrades prior to moving in. Now, 70% of our business is homeowners who want updates to their existing homes,” says one remodeler in Jeff’s piece. Read more about it on page 20.

Whether you build two homes a year, plan subdivisions or design award-winning projects, what are you doing differently now than in the past to stay afloat, turn a profit and grow your business?