The Newport Beach-based homebuilder started by cabinetmaker Ron Simon has sold out 103 homes at its initial development in Menifee east of Temecula.
The homes were sold in less than nine months, according to The New House, the homebuilder Simon started in 2009.
The number of homes sold makes The New House one of Southern California’s top home sellers after Irvine Company, which has sold more than 1,300 new homes since late 2009.
New House’s Menifee development has been the top selling development in the Inland Empire’s hard-hit housing market, according to Newport Beach-based market tracker Concord Group.
The builder sold 78 homes from October to March, an average of more than 10 per month, according to Concord. That topped the 1.5 homes sold per month at other Inland Empire developments, it said.
The New House now is working on homes in Beaumont east of Riverside, where 77 homes are planned.
The builder also is putting up nine homes in Buena Park as part of a project by the city’s redevelopment agency to provide affordable homes.
The New House builds homes using manufacturing techniques honed by Simon at his RSI Holding Corp., holding company for a maker of household cabinets.
Walls, floors and roof trusses for The New House’s homes are made at a factory in Mira Loma and assembled at project sites.
“Our view of homebuilding is really different than traditional builders,” Simon said. “We view it as manufacturing. We approach building our houses like building cars, cabinets, or any other highly engineered products.”
Efficient, Affordable
The business model is designed to make homebuilding more efficient and affordable for buyers. The New House’s Menifee homes sold for $143,500 to $210,500.
They range in size from 1,232 to 2,401 square feet.
The homes, which include granite counters and tankless water heaters, are built in about 25 days after being sold.
Buyers select a house design based on The New House’s models next to its Mira Loma factory.
“Now we have proven that when houses can be produced and sold at prices people can afford, there are buyers for them even in this market,” Simon said.
The business takes a page from Simon’s cabinet business, RSI Home Products, which has been able to compete with Asian rivals with lean, efficient manufacturing.
The company makes cabinets in Anaheim, North Carolina, Kansas and Mexico.
In the 1980s, Simon sold Perma-Bilt Industries, a cabinetmaker founded by his father, to an Australian company.
He left to start RSI Home after Perma-Bilt’s owners rejected his plan to compete with emerging Asian rivals.
Perma-Bilt no longer is in business, while Simon used his plan as the basis for RSI Home.
In 2008, Simon sold half of RSI Home Products to Toronto-based private equity investor Onex Corp. for $318 million.
He then invested $100 million to start The New House.
The company put up its first homes in 2009 in Santa Ana. It built two affordable homes as part of the city’s bid to develop affordable housing.
The homes were built in 15 days. One was 1,600 square feet and was sold to the city for $85,000. The other was 2,000 square feet and went for $95,000.
The homebuilder’s goal is to expand to other markets across the country, according to Simon.
