Once we had a grasp on our priorities and goals for the 2020 20K we started to dig into the budget. We began by analyzing how much our target 20K client can afford. As we are aiming to make these homes available to someone living at the poverty line, we started with the US Census Bureau / American Community Survey statistics for poverty in Hale County in 2019. According to the ACS, an individual living in poverty in Hale County in 2019 makes around $12,500 per year, leaving them with a monthly income of $1,041. From this, we determined that if the client is spending 25% of their monthly income on mortgage, that they will be able to reserve $260 per month for mortgage payments. At a 5% interest rate for a 30-year mortgage, that gives us a price of $50,000.
Next, as point of comparison, we calculated how much the original three product-line homes (Dave’s, Mac’s, and Joanne’s) would cost if they were built today. We found that material costs have increased about 75% since 2009, and that if they were built today the product line homes would cost (in materials only) 21-26K. Since labor rates vary dramatically, we estimated that labor would average around the same as material costs, giving us a total cost of 42-52K for the product-line homes in 2019. This puts the total cost of these homes right around our target cost of 50K, with no wiggle room for changes or upgrades.
From that point on, we started to research and consider alternative construction methods that could help us save on materials, labor, and time. In looking around the area and we noticed that many of the buildings in West Alabama that are locally built use post-frame (or “pole-barn” construction methods). This type of construction uses large posts (or poles) on the eave ends of the building to carry the entire roof load – leaving the interior and the gable ends of the building free of load-bearing structural members.
Although this construction method is not typically used for residential structures, it can be, and in fact there are many advantages to doing so. The post-frame construction method involves first erecting the load-bearing posts, then installing the roof, and then infilling below the roof (versus traditional sequencing of stick-built construction starting with foundation, then walls, then roof). As compared with stick-built construction, post-frame construction can be faster, less expensive, and allow for more flexibility. As a result of this investigation, we have decided to move forward with designing the 2020 20K using post-frame construction, which has never been tried before in any of the previous 23 iterations!