REAL Exclusive Magazine

Interview With Builder John Cannon

By Ed Bertha

John Cannon graduated from Michigan State University with a Bachelors of Science in Building Construction and first came to Sarasota in 1979 to work for a national builder. Shortly thereafter, he and his wife Phillipa founded the firm bearing his name, and have been building luxurious custom homes for nearly 25 years in many of southwest Florida’s most prestigious communities. Sitting with John at his new Tauri model we had a chance to talk about the market and the changes John Cannon Homes has undergone.

EB  John, you’re selling homes and launching new models in a price range that before the run up was considered luxury. What did your firm do to get traction in the market?

JC  Ed, we have the best subcontractors in the market and we didn’t want to lose them. We met with every sub and had a frank discussion. 2005 is gone. We have been able to reduce our prices and costs to a point where we can offer new homes at similar prices as short sales and foreclosures with all of the benefits of new construction; i.e. newest designs that  meet or exceed the latest construction codes, energy saving appliances, impact resistant windows and sliding glass doors, and homes with warranties.

We have also simplified our sales model. We want our homeowners to know exactly what they are buying and exactly how much it will cost them. Unlike some builders, we still encourage our homeowners to select finishes and details that are unique for their family and lifestyle but we have standardized a lot of our pricing. We’ve eliminated the anxiety and uncertainty in buying a new home.

EB  Have you changed your approach in dealing with Realtors?

JC  Realtors have always been, and will continue to be, a vital referral source for our company. As a way to reward our Realtors for their hard work, we are currently paying their commissions at contract signing so our Realtors do not have to wait for a closing or for the slab to be poured. It sounds a little strange to be excited to write checks but our realtors represent 50% of our sales and are very important to us. It is great to compensate them so quickly. 

EB  With your new approach yielding buyers, are you now in a position to compete against short sales and foreclosures?

JC   We certainly are. Distressed properties are often neglected, damaged, and after no love and care, can have many hidden problems. Naturally, a new home with a warranty that is built to current codes and efficiencies would be a much better investment that a questionable distressed property. Why would anyone choose to buy that type of home when we can put them in a brand new home, with a warranty, at a competitive price?

EB  You mentioned technology advancements since 2005. What benefits do these advancements bring to today’s home buyers?

JC  If you compare operating costs of a home built in 2005 and a new home today there are significant savings. Take our new Tauri model. At 3,141 square feet under air operating costs, electric, water, insurance, etc., can run as much as $3,000 a year less than a similar sized home built in 2005. New construction codes, advances in windows and insulation along with items like tankless water heaters that provide instant hot water all contribute to the savings. Buyers can choose to pocket the savings or at today’s mortgage rates buy an extra $75,000 – $100,000 of home. That’s significant.

EB  Back to foreclosures. I just heard you say beyond competitive pricing, technology advancements make owning a home built around 2005 significantly more expensive than a new home today. Why not look at new construction?

JC  You are absolutely right. When you consider a competitive fixed cost to build, annual operating cost savings and the peace of mind of a warranty there are very few instances where we cannot be competitive with distressed properties. It just doesn’t make sense not to give us a chance to compete. We are very competitive.

EB  John, one last question sailing or skiing?

JC  Right now Phillipa and myself are enjoying our two children, Rachel and Jack, as we realize that too soon we’ll be empty-nesters. Rachel is a senior, Jack a junior, both at Out-of-Door Academy and their extracurricular sporting activities keep us on the go during the school year. As for the holidays, skiing with our family in Wyoming is our passion and we thoroughly enjoy it… almost as much as we love building homes!