How Market Research Nearly Doubled the Price of Stone Cottages – Gerry’s Story

Introduction

Gerry (not his real name) runs a successful housebuilding company. On one development of around 80 homes, a quarter were traditional stone-built cottages and the rest were ordinary houses.

Josef, Gerry’s Virtual Finance Director (VFD), was reviewing the monthly site-by-site profit figures when something didn’t look right. The stone cottages were selling for much the same as the ordinary houses on the same site.

Situation

About 60 ordinary houses and 20 stone cottages on one site.
In today’s prices, the houses were selling for about £250,000 each.
The cottages had been priced at much the same, as if they were simply another house type.
Four cottages had already sold at that price.

Obstacles

Priced like the rest of the site. The cottages had been priced by size and plot, like the other homes, not by what made them special.
No evidence. Nobody had checked what traditional stone cottages actually sold for locally.
Fear of slowing sales. Raising prices risked leaving homes unsold, so the business needed proof before changing anything.

Action

✔ Questioned the pricing, comparing what the cottages were earning with their character and appeal.
✔ Researched the market, finding out what traditional stone cottages sold for in the area compared with new-build houses.
✔ Built the case, giving Gerry and his sales team clear evidence of what buyers would pay.
✔ Re-priced the remaining 16 cottages.

Result

✅ The remaining 16 cottages sold for around £490,000 each in today’s prices, almost double the price of the ordinary houses.
✅ £3.84 million of extra sales, with build costs unchanged, so almost all of it went straight to profit.
✅ A new rule for the business: price on what buyers value, not just on what it costs to build.

Conclusion

Most housebuilders focus on cutting costs, and rightly so. But Gerry’s biggest win on this site came from the other side of the profit line.

By looking at the sales figures alongside the site costs, Josef spotted value that was being given away, and used evidence to recover it before the rest of the cottages were sold.