This report is available exclusively to subscribers of Inman Intel, a data and research arm of Inman offering deep insights and market intelligence on the business of residential real estate and proptech. Subscribe today.
Higharc, which offers an enterprise-level homebuilding visualization and business operations solution, has received a $15 million investment from a trio of notable innovation backers, headlined by Home Depot Ventures, the venture capital initiative of the massive home goods retailer.
Joining the hardware brand is Standard Investments, the investment arm of global industrial company Standard Industries, and Carl Bass, former president and CEO of Autodesk Inc., who joins Higharc as an adviser, according to a July 18 announcement sent to Inman.
To date, Durham, North Carolina-based Higharc has raised more than $40 million. The technology company’s CEO Marc Minor, said in a statement that he’s excited to see where the cash infusion will take the company.
“Transformational change in critical industries like homebuilding depends on robust partnerships,” Minor said. “The decision of these industry leaders to support Higharc as we expand our platform speaks to the caliber of our team and the impact Higharc has made for builders across the country.”
The company’s solutions are coded to innovate the multitude of steps in home construction that have been manually performed for decades or stricken by lesser software systems. Higharc offers dynamic drafting and modeling, planned community operations, budgets, procurement and estimation, as well as sales support and consumer-facing marketing efforts.
Modules are designed to be integrated, connecting the endless minutiae that accompany building even the smallest freestanding home.
Higharc’s capabilities also enable buyers to configure their new homes using online 3D models and also dramatically speed up the builder’s ability to get these homes to market, according to the announcement.
Software firms like Higharc offer the homebuilding industry additional resources to scale in the face of intense pressure from the greater marketplace, due to a lack of inventory, a long-burdensome byproduct of the Great Recession that began in 2008. A number of companies are entering the space, one being Welcome Homes, which was funded $29 million by Era Ventures in early 2023.
Ownly is a SaaS (software as a service) company that provides homebuilders with a consumer-driven retail storefront from which aspiring buyers can shop for homes with a Netflix-inspired browsing experience, get prequalified for mortgages and sign offer-to-purchase contracts.
And Dash is a newly launched search engine that focuses solely on providing agents with information from homebuilders on pre- and new-construction homes.
The Wall Street Journal reported that the country’s housing needs outpace available stock by as many as 7.3 million units. However, Inman reported that builder confidence rose to a key level in May after climbing for five straight months as high-interest rates put a damper on inventory for the spring real estate market, according to a report.
That’s the highest level since July 2022, when rapidly rising interest rates began to cool both buyer demand and builder confidence, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
Additionally, Inman reported that homebuilders and residential trade contractors added 59,800 jobs in the month of May, a 0.3 percent seasonally adjusted monthly increase since May, which triples the rate of job growth seen in other areas of real estate and the broader economy.
New homes now represent a third of all homes on the market. That’s 2.5 times higher than the historical average for the two decades leading up to COVID-19. It also sets up the likelihood that buyers will be looking at new homes in the future, according to NAHB Chief Economist Robert Dietz.
“Lack of existing inventory continues to drive buyers to new construction,” Dietz said. “With limited available housing inventory, new construction will continue to be a significant part of prospective buyers’ search in the quarters ahead.”
Higharc and its technology brethren demonstrate a point on which homebuilders can pivot toward a more automated workflow, ranging from land analysis to materials sourcing. Much like the mortgage business, every aspect of the homebuilding process, even the office-based administrative tedium that can be automated or made smarter through software, is a win for consumers.
“More and more, there are constraints in homebuilding with respect to supply chain and labor issues,” said Ted Brock, president of Buffington Homes, in the announcement. “We are thrilled to work with Higharc because of the incredible flexibility their platform provides to us in building homes and easily handling changes with our teams in the field.
“This removes a ton of frustration and confusion for everyone involved, creates less errors on the job site, and provides a better homebuyer experience.”
Higharc was founded in 2018.
