A Conversation With: Michael BenshoofPresident, Berks Homes
Michael Benshoof is president of Berks Homes, a family-owned home-building company.
He has more than 25 years of experience in the industry, including a stint as director of business analysis for the National Association of Home Builders.
Benshoof, who turned 48 on Jan. 9, has a bachelor’s degree in English with a minor in business from Penn State and an MBA in finance organizational behavior from Marymount University in Arlington, Virginia.
He and his wife, along with their two children, live in Dover.
Q: Why is the Harrisburg area one of the fastest-growing regions for real estate?
A: It’s one of the few areas in Pennsylvania that’s had population growth. There are big businesses that have moved into the area, like Amazon [warehouses]. The capital always drives the Harrisburg region also. Deloitte has a big IT presence here. We’re so close to a lot of other major cities, too.
For many years, the trend was to build homes with a lot of square footage on a small lot. Do you see that continuing?
What happened during the 1990s is, people built “McMansions,” and when the downturn hit, people shifted to smaller homes, but then wage growth and job security did not come back as quickly as after other downturns. The preferences were changed out of necessity. I think people were already starting to question the open two-story foyer and saying, I’m heating that and I’m losing the square footage, so even before the downturn we were starting to have people close off those foyers and add an additional bedroom. At the same time, the preference for a more open floor plan came into play. We have what we call a 3 percent rule, making sure there’s not more than 3 percent in hallways or not useful spaces.
I think wages have started to increase again, the millennials who delayed lots of things out of necessity, they’re starting to have families. The biggest difference I’ve seen is, this time around, people still want to try to get the largest home they can afford, that fits their needs, but they’re a lot more disciplined on how far they’re willing to stretch.
What impact, if any, do you think current economic conditions — fluctuating market, tariffs — will have on your industry?
Real estate is local. One of the nice things about Central Pennsylvania is it’s a lot more steady-Eddie; when you don’t have the super highs, you also don’t have the super lows. Basically you’ve got job security, an overall healthy economy and a large population that needs housing. The interest rate discussions have been making people nervous. A lot of people don’t understand that mortgage rates and the Fed interest rate are not in 100 percent tandem.
You’ve got the other wild card, which is tariffs. Last year lumber tariffs really hurt. What’s difficult with the tariffs right now is everything is in limbo and nobody’s really sure what the impact is going to be; we just have to wait and adapt. There’s the weather. We’re hoping next year doesn’t have this amount of record rainfall.
Two-story, split-level or rancher?
I personally prefer two-story, I guess because of our obsession with designing as value-engineered a home as possible. I like a two-story, master up, as efficiently designed as possible because that’s such a part of what drives our business.