The Austin Startup Rebuilding the American Dream | The American Housing Corporation

What's up, S3? Welcome to my crib. Well, actually, the prototype house for the American Housing Corporation. Come on in and I'll show you around. We are here to build the best family homes in the best neighborhoods in America. We're selling good homes and good neighborhoods for a good price. American Housing is here to re-urbanize America and rebuild the American dream. When I look at the housing crisis and really boil it down to what is really wrong about housing in the United States, we do not build family-sized housing in the most desirable cities and neighborhoods in the country. There's no more land in the best parts of Austin or LA or San Francisco to build a new neighborhood of 300 single-family homes. You gotta start building up. We believe the solution to the affordability crisis is just supply. Build as much supply as you possibly can. As we build, that supply is gonna drive down costs. Initially, this home is gonna be sold for market rate. Whatever that market rate is in Austin or wherever else we're building, but eventually it will come down. We are today laser-focused on building family-sized housing in the most desirable cities and neighborhoods in the country, which usually happen to be the most expensive as well. I moved to Austin at a time when it was super expensive and we had a ton of demand. I mean, a decent amount of supply, but not nearly enough to meet that demand. I think of myself as a builder and mechanical engineer by training, and then I became a software engineer because it was a lot easier to build things quickly and see the fruits of your labor. I saw Jason's first video on S3, and around the time I had felt like there wasn't any optimistic media in general. It was all negative. I just knew from my experience in tech that you can't make a better world. I was a big fan from day one of just seeing these companies go after the impossible, which obviously inspired us to do the same. I was living in LA. I was working for SpaceX. I was actually living in Hawthorne. I talked to some developers that had purchased land in LA and they had gotten permits, but they hadn't broken ground yet. And I asked them why, and they said it was because they were waiting for construction costs to come down so that the project would pencil. I started visiting construction sites and I was like, well, I can tell you why it's so expensive. I mean, look at just how inefficient these sites are. Why aren't we applying the same technologies, the same manufacturing methods that work so well in automotive and in consumer electronics and aerospace? Like, why aren't we applying that to solving arguably the most important problem of our generation? Riley and I have known each other since college. We're in the BYU Rocketry team together. I was the only computer science student in the club and he was, of course, Mech-E. It wasn't until a few years ago that I realized that flight software and just software in general could be used for factory and manufacturing. I started a company that was essentially trying to just bring back the idea of the Sears kit home, just create a catalog of designs that can be produced in a factory, shipped to the site, and the home builder puts it together. It was then that I realized just how terrible of an idea that was. If you want to change the way that homes are built in the United States, you have to be a home builder. You cannot expect the existing players to change and adopt new technology. Riley and I and Will and Bobby all got together and realized that we actually had the core components of it all with real estate experience and building experience. We are big believers in the housing theory of everything, that if you solve housing, then it'll solve so many other issues that we have in the country. So we started the American Housing Corporation to go and tackle those problems, but we felt that the only way to do so was to be vertically integrated as both the real estate development company and the manufacturing company. We buy land, we build homes, we sell them to customers. So this is the first house that we ever built. It is the proof of concept for our building system, proving what we can make with the components that we produce in our factory. So this is a three-story, four-bedroom, two-and-a-half-bathroom, 1,800-square-foot townhouse. Took us three weeks to put together and two weeks to finish out. We kind of like worked backwards from where we wanted to be. We wanted to deliver a good home for a good price. In order to do that, we kind of just like peeled everything back and said, we want to build three-story row homes in these great neighborhoods. This is the price we need to hit in order for it to be profitable and for the projects to actually work. Let's go and develop a system that can be produced at scale by machines in a cost-effective way. We go and design the individual components and we spend a lot of time making sure that each one of those components is beautiful, but also designed for manufacturing. And then when it comes to the actual project level, all we're doing is just pulling from this library of components and arranging them in different ways for that site. Very similar to a Lego set, you can use the same pieces for making the Death Star or Formula One car. We're doing the same thing here. It's the same parts and you can use them for making a three-story home like we see in the back or the two-story one that we're building in Prototown, a large apartment complex. It all just comes back to the same pieces that are mass-produced in the factory. Every part we produce in the factory needs to fit inside of a container so that we can ship from the factory to the site in a very cost-effective way. We wanted to show that we could put it together with significantly less labor than standard construction and that the end result is something nice and that people would want to live in. All the millwork was pre-installed, the countertops, the outlets, the appliances. It was one finished piece getting craned into place versus just dropping in a wall and then sending out a crew to install the cabinets and stuff like that. We've got floor-to-ceiling glass. We have sliding glass doors. We have some windows that you'll see that are just like punched out of the wall. Bobby, my co-founder, he talks a lot about building housing for young families and how a big part of designing for young families is designing bedrooms that are more child-sized. The very small like kid-sized bedrooms on the second floor and then you come up here and it's a true like primary suite and all packed into 1,800 square feet. Walk-in closet with every American housing hat you could want. Hi, I'm Adrienne and I'm an industrial designer. So I'm working with Matt on the millwork, kind of more like the finishes and like little bits of joinery and how to make it like feel really nice and homey and cozy, but still be something that we can make at scale. The idea that like some decision that I made will be like used by dozens of families is exciting. Now, when I first started it, I don't think I would have imagined us building a 6 million pound press. It's a bit of a beast. Fully custom designed in-house. Total, we spent probably like 300 grand on this where a comparable press is close to 2 million plus. Like we built it in just over three months or so where the wait time is about a year and a half. We use it for all of our structurally insulated panels, our skin laminations, kind of everything that we need. We mock up just all the different ways that we could arrange the parts and arrange the homes and the beauty of designing each one of these homes using these like pre-designed, pre-engineered components. We know exactly how many components go in the second we design the home. We know exactly how much it costs, material cost-wise. We're able to iterate really quickly on these site plans. But again, it's kind of like all on top of the foundation of our building system and this kind of like component library. We're really working to automate a lot of that on the software side. You have a parametric modeling in CAD where you can change a bunch of values and you make your walls a little bit longer. That's great. But taking that from CAD to actual production is where things get really difficult. So what we're doing on our side, which we call our software Alamo, we are creating the system that takes those plans and makes the production of those actually scalable. We have a part definition, which is a generalized part. So like a generalized wall design that has all of the different parameters that you can change. And what we do is we take that design and then we essentially write these like work instructions that then can be parametric as well. We're able to generate the machine code that operates all of the CNC machines, the press, and all these other things. So that way we can like never have to redesign or design an infinite number of walls. We want to design it once and then we want to be able to produce it. We were building the IKEA instructions of homes. The guys on site basically open up Alamo and they have a step-by-step guide of what they need to pick up and which things do they need to connect after they land. But the components themselves, I mean, we could use them for making row homes, single family homes. We're really kind of artificially limiting ourselves to one typology in the beginning so that we can really focus on just like, you know, getting the fundamental business practices in place. But I mean, the name of the company is the American Housing Corporation. Like we want to build housing of all types all over the country. We're at Prototown outside of Lockhart, Texas. It's part of the Greater Texas Triangle. America's future shins in, as I like to say, is almost like a commune of engineers. You have a bunch of engineers that live out here and they are testing out all their hardware products, companies, a bunch of like really cool, open-minded people out here just building. For us, we're testing and prototyping. This will be the first one that somebody will actually live in. We're trying out this awesome circle window right now. It's pretty cool. And there's gonna be a bench right under it. So like there'll be like a breakfast nook and a bench. And so you'll be able to just like sit in the circle window. It'll be really cool. And this one will end up being two stories and it will be two and a half bedrooms and two baths. The next factory that we're building will do 1,200 homes a year. 100X we'll be doing out of this building. The reason we're doing that is to solve for the main bottleneck, which is production. In the near term, like we are really innovating on the way homes are built, but long-term, there is no like housing brand in America today in the way that you have like automotive brands or consumer electronics brands. We want to be that brand. We want to build a relationship with our customers. And so, you know, we were already doing everything else, you know, acquiring the land, getting the permits, building the homes, like that last piece of delivering it to the customer allows us to start building a really great relationship with them long-term while also, yeah, saving some money by not having to pay a broker. We are all here at the company obsessed with creating great product and something that we are really proud to introduce to the world and something that we would recommend to our friends and our family. We want to be able to see like thriving families and children, you know, frolic in these neighborhoods that like haven't seen kids in decades. Think about like your grandmother, think about your child's teacher or the firefighter in your neighborhood. Like these are people who you want to live in your neighborhood that already served your neighborhood. That's why you should care. We are trying really hard to make sure that these homes are not just great to live in but they're also great to live next to. We want people to be excited when we build in their neighborhood. This episode of S3 is a very special one because of who is in it. Harris, one of the co-founders of the American Housing Corporation has been a longtime friend of mine in the show. I think like you Josiah, he watched it for a long, long time and realized that he wanted to stop working on software and wanted to work on physical stuff in the real world which is a big part of what the show is about. I remember Harris and I talking a lot about if he should do it, if it made sense for him to found this at Riley. And then in short order, they decided to do it, moved to Austin and started building this thing. And boy, oh boy, they've gotten a lot done. What was it like seeing this and filming at this company for you guys? When we first walked into the factory, the building, like the individual pieces that are required for the house are pretty like low key. And it looks like, okay, this is cool stuff. And then you walk outside and you see like how they put all these things together to make actually beautiful home. They're literally just like piecing these things into like, there it goes, that's the next part. It's like essentially Lego for adults and Lego pieces that will eventually solve the housing crisis. So it's pretty, in fact, it's pretty cool. If I'm mistaken, I'm thinking that Harris also made a guest appearance on our short film, Planet. Yeah, my first sci-fi short film, Planet, Harris is one of the talking engineers along with Cameron, CEO of Range View. Their main goal is to solve the housing crisis. And one of the side effects of that is gonna be price. And that was our question though too, of just like, who's actually going to live in these homes? Their answer was kind of like, you know, it's gonna be market rate. At what date do the costs actually come down? Was like our big question mark that we didn't feel like we really were able to get a strong answer on. I mean, if I had to guess, it's probably gonna be expensive and somewhere near normal pricing, but like, it's just like Tesla. You build the expensive Roadster and then the Model S and then eventually you get to build the Model 3. They've built everything in-house as much as they can. They're going to buy the land themselves, develop it themselves and sell it themselves. Buying the land, building the house, setting up the house, selling the house. Like it's the full thing. Prices are high if supply is low. So if you can create enough houses where the supply is no longer an issue, like if everyone has a home they can buy, prices automatically are naturally gonna go down. Their manufacturing technique is allowing them to build houses, you know, like cars, a bunch of them. It's pretty cool. And in desirable cities too. Very down to live in American Housing Corporation house. Yes. Me too. Just like how American Housing Corporation is building housing good quality, fast here in America, the sponsor of today's video, SenCutSend, is doing the same thing with motor parts. SenCutSend has sponsored a few episodes of S3 now and I don't know if we featured many companies that don't actually use SenCutSend in what they're building. SenCutSend makes fast, affordable metal parts here in America, whether it's sheet metal, or even now getting into CNCing, you can get it done with SenCutSend. You upload a part, you get a quote, you pay for it, and a few days later, that part arrives on your doorstep. So if you're building something and you'd like a discount, check out SenCutSend.com slash S3 and tell them we send you. Thank you again for watching this episode of S3. And as always, until next time, keep on building the future.