The National Housing Quality (NHQ) Builder and Trade Contractor Certification programs emphasize “building it right the first time, every time,” rather than wasting time and money having problems inspected out of jobs. Certification requirements ensure that all elements of a company’s quality assurance systems are incorporated to improve quality performance and provide greater customer satisfaction. Results of a recent Research Center survey of NHQ Certified builders and trade contractors underscored the program’s positive impact on productivity, profitability, and customer satisfaction ratings for participating companies.

Driving Forces Behind NHQ Success

Three key factors have driven the NHQ Program’s growth since its initial pilot phase in 2003 and national launch in 2005. First, today’s consumers are more knowledgeable than ever before and are demanding better products and service. Second, some areas of the country have experienced a rise in construction defect litigation. And third, the availability of general liability insurance has decreased while the cost has increased for most home builders and trade contractors.

Since its national launch in late 2005, participation in the NHQ Certified Builder program has increased 77 percent, rising from 26 builders to 46 at the end of 2006. An additional 24 small and large builders are currently involved in the program’s consultative phase and are working toward certification by the end of 2007.

One of the NHQ Certified Builder program’s primary components encourages builders to work more efficiently with their trade partners. As a result, participation in the complementary NHQ Certified Trade Contractor Program has now reached over 2,600 companies—375 of which have achieved NHQ Certification— a 64 percent increase over Q1 2006.

NHQ Certified Builders and Trades Realizing Results

Survey participants indicated that they’ve realized tangible business improvements and documented significant increases in productivity and profitability, as well as increased customer satisfaction as reported in customer feedback surveys. Notably, in some markets, NHQ Certified Builders have experienced a bump up in the J.D. Powers rankings.

Tim Lewis Communities, an NHQ Certified Builder in Sacramento, Calif. ranked among the top three in customer satisfaction for the market according to the J.D. Power and Associates 2006 “New Home Builder Customer Satisfaction Survey.” Problems per 100 homes are also down for the company, which reports a nearly 50 percent drop in the number since 2004; leading the Sacramento market with the fewest per 100.

Tim Lewis, president of Tim Lewis Communities said, “Due to our quality check process prior to orientation, defects during construction have dropped by nearly 50 percent since becoming NHQ Certified. It is agreed within our company, that NHQ certification has helped catapult us into this high ranking.”

Responses from builders also revealed that over 70 percent had improved their bottom line. Additionally, over 75 percent reported a reduction in callbacks and improved relationships with trades.

David Simon, president of operations for Veridian Homes said, “NHQ Builder Certification has allowed us to integrate our quality, safety, and environmental systems, creating efficiencies and improving the effectiveness of our operations. Results in 2006 included a reduction in inspection costs by 50 percent while at the same time reducing defects by over 50 percent.” 

A companion survey of NHQ Certified trade contractors revealed that operational improvements achieved with the NHQ Certified Builder program are not one-sided. Over 80 percent of NHQ Certified trade contractors reported a reduction in callbacks. Additionally, 88 percent achieved an increase in employee accountability; 79 percent improved relationships with builders; and over 65 percent improved their bottom line.

Frank Alexander, NHQ program director at the NAHB Research Center, credits the consistent growth of the program to the continued support of industry partners and an increasing number quality-focused builders, suppliers, and trades seeking to distinguish themselves from competitors in their respective markets and improve customer satisfaction for homebuyers.[return to top]