How Much Should Design Cost?

The architectural profession is broken in the single-family house biz; the vast majority of people live in houses that were built by developers from generic plans. The number of houses designed by architects to suit the needs of specific clients is negligible. It is also expensive; a small house can take as much time to design as a very big one, and as much time as a much more profitable commercial job that doesn't require client meetings on evenings and weekends.

It is the reason so many architects (including myself) fell in love with prefab; it would make architecture more like industrial design, where the cost of development would be spread over a number of units, and where a design could actually be prototyped and refined as it was produced. But prefab needs factories, installation trades, and a service infrastructure that is not yet widespread.
Smartbox by Freegreen

Another approach to making good green design available to a larger audience is through stock plans, where architects licence the use of their designs for clients to build themselves or with a builder. You can go to any bookstore and see a whole rack of plan books, and go online and see thousands of them. Most people buy the plan book but not the plan; the ripoff rate is unknown, but I cannot count how many prospective customers came to me with them when I was working in prefab, and I suspect it's up around 90%.


Smartbox Kitchen

That is why I was so intrigued by FreeGreen, the new company that gives away the plans; to use the expression from ten years ago, "information wants to be free"- why pay for it if you can steal it. Yet coincidentally with David Wax and FreeGreen offering their plans for the price of exactly zero, modern green stock plan pioneer Greg Lavardera has tripled the price of his. What is going on? I asked David Wax of Freegreen for his opinion, and he sent me a long, thoughtful response which I repeat herein:


interview with David Wax. I apologise for the lousy quality

1) I think that the trend of architects moving towards higher plan prices is really a filter. These architects are filtering clients for very different reasons. Some are filtering clients because they are tired of having there design changed. The concept here is that if you charge more then the client is less likely to alter and\or ruin your design. Some are using this filter because they believe that when design is more expensive people are less likely to steal it (more people steal baseball cards than diamond rings). To be honest, I am not sure that I agree with that, but it is an idea. I am worried that a $15,000 item that is really easy to steal might be just too tempting for some folks.

2) I think that for branded or semi-branded architects this concept of moving up the food chain makes individual sense. Said another way, if you can differentiate your self and your designs you will probably make more selling them for $10K then for $750

3) This is the way that the paid version of the home plan market has to go. With a 50% theft rate and folks like CoolHousePlans pushing plan prices down to $500 per plan, the better designers had to find a way to make this work for them. Charging significantly more for plans is exactly the right answer for established plan designers. For the young or not established designers this does pose a problem. That is where FreeGreen Open Source Program comes in. We will give them a haven where they can make real money, get their name out, and if they are good enough make it to charging high fees for their plans (like this new trend).

4) The creation of this "High End" home plan design does a number of interesting things in my mind:

a. It creates a massive void of people that can no longer afford plans from these architects. Assuming that these High End plans are a trend, this means that the best designers will move out of the financial reach of the mainstream. That is exactly where FreeGreen comes in. We are happy to serve this market (which by the way is about 80% of the population). We focus on them, cater to them, and become their singular answer for great green design and good value. There will always be a High End and Low End in any market. This new expensive plan model will allow plan developers to enter High End, but also creates an enormous opportunity for FreeGreen.

b. It creates two losers. The biggest loser is Eplans, CoolHousePlans, etc. On one side they have Higher End plan sites like Houseplans.com pushing up the prices and quality of their designs. On the other side they have FreeGreen giving away great plans for free. They are now stuck in the middle arguing that their $750 plans have more value than FreeGreen free plans, but are still affordable unlike the branded house plans. This is not a good place to be. The second loser could be the low end or small custom design market. If consumers can get a branded house plan for less than a no-name local custom architect they may go for it. Now this is not true across the board. Most people that hire custom architects, hire them because they want a house that fits them, no matter what the price. But, on the margin is where the little firms play and this could be a problem.

In summary I think that there is a place for these High End plans, and for those that can pull it off, I think this will be a good business (if they can avoid or stop rampant stealing). From a FreeGreen strategy perspective this is all great news. The filtering of clients by great home plan designers expands FreeGreen market and potential market share. This expansion gives us the growing market that we need to convince our vendors that we can successfully promote their product.


Interview with Greg Lavardera

Greg Lavardera notes on his website that he has switched from selling his plans directly, but is now working with Houseplans.com. "This is part of an effort elevate the level of design offered in the form of stock plans, not only modern houses, but of all styles. This has been a goal of mine since starting this venture, and for the first time in the leadership at Houseplans.com I have found a similar vision. They are committed to marketing better designed home plans in a different way - a way in which design is more important than square feet, or bedroom count. The offering that they will assemble will completely out-class the offerings of other vendors and it is my sincere hope that this brings pressure to bear on them to improve their game. The end result, I hope, is the enlightenment of the buying public to better design, the creation of demand for better designed homes, and the inevitable move of the market to fill that demand. End game - better designed homes readily available for everyone, particularly for my camp of modernists."

I have always thought that the industrial design model, where the designer gets a royalty for each product produced and sold, made a lot more sense than trying to make every house different and get a full fee for every one. But like so much available on the internet, so much of it gets stolen. Greg Lavardera has differentiated his product, so that there is added value to the consumer, but which of the three models has the best future: Free? $ 4,500 for a stock plan? $ 15,000 for a one-off?

More on Plans on TreeHugger:

Free Green Turns House Design Business On Its Head
Click Your Way to Greg Lavardera's Modern Stock Plans
You Too Can Own a C3 Cabin by Vandeventer+Carlander Architects
Prefab : Green or Greewashing?

Tags: Architecture | Designers

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