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We are finally back from our mid
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-season break. We are back. It feels
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fantastic to be in the studio, and
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we are kicking off the second half
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of the season with a deep dive that's
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incredibly specific. And most importantly,
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actionable. Especially for our listeners
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in Arizona. Yes. If you are a construction
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business owner or a project manager
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in the Grand Canyon State, this
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is basically your roadmap for the
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next, what, 18 months? Absolutely.
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Our mission today is laser focused.
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We've taken a whole stack of sources.
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We're talking Zillow reports, public
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energy programming, even local charity
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stuff. And we're pulling out the
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concrete business opportunities
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for contractors. Exactly. We're
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analyzing the data to find the clear
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signals for where your next profitable
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contracts are going to come from.
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We are essentially mapping. the
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future job site, reading between
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the lines. But before we dig into
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all that, the Zillow expectation
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gaps, the green energy signals,
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we have to recognize the partner
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that makes this all possible. That's
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right. Today's episode is brought
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to you by smartbusinessautomator
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.com, the operations engine behind
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modern construction firms that want
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to scale smarter, not harder. If
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you're dealing with project delays,
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chaotic scheduling, drop balls on
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follow -ups or manual bottlenecks,
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Smart Business Automator helps you
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automate back office workflows and
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change order follow -ups, streamline
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subcontractor coordination and client
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communication, track bids, leads,
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and financials in one clean dashboard.
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Free up your time to focus on building,
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hiring, and closing bigger deals.
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Because in construction, scale without
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systems is just stress. Now. Let's
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deep dive. We're back. And so is
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our partner, Smart Business Automator.
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And they get it. They understand
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that the larger and more complex
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the contract, like the ones we're
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about to talk about, the more crushing
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the administrative side becomes.
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Oh, for sure. We'll show you later
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how they cut through all that noise
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so you can actually focus on winning
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the contracts we're identifying
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right now. Okay, let's do it. Okay,
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so let's untack this. We are starting
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with the Arizona residential market.
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We're pulling data from Zillow,
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some analysis from ASU experts.
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And the big question we're trying
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to answer for you is this. With
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all the current volatility, should
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you be doubling down on new builds?
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Or is it time for a strategic pivot
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to renovations? The pivot. That's
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the key word. And the data, well,
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it strongly suggests a pivot is
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necessary. If we look at the latest
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Zillow Home Value Index through...
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November 30, 2025. Right. The average
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Arizona home value is sitting at
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about $417 ,000. Okay. Still a hefty
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number. It is. But here's the key
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data point. The one -year value
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change, it's down 3 .1%. Wow. So
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that rapid acceleration we saw for
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years hasn't just stalled, it's
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actually reversed. It's reversed.
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And this isn't just an Arizona thing.
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Oh, it's a national trend. Nationally,
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Zillow found that over half of U
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.S. homes lost value in the past
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year. That's the highest percentage
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we've seen since, what, 2012? Right,
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since the recovery started. And
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Arizona is right in the thick of
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it. The West and the South saw the
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biggest slowdowns. And that's partly
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due to more houses being available,
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but also climate risks. Things like
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wildfires and extreme heat. are
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starting to really influence insurance
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markets. It's a fascinating dynamic,
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though, because the underlying economy
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is still pretty strong. Very strong.
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You look at data from groups like
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the Black Chamber of Arizona, you
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see huge growth in people coming
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in with jobs in tech, banking, manufacturing.
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So the economy is solid. People
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aren't fleeing the state. Demand
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for housing is still there. Exactly.
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And that's the context, right? It
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explains why sellers are so stubborn.
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They know the demand exists. But
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the high interest rates are forcing
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buyers to be much more cautious.
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More demand. Much more demanding.
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And that brings us right to Phoenix,
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where the renovation signal is just...
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ringing loud and clear. Okay, so
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Phoenix specifically. Phoenix ranked
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high among cities with a decline
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in value expectations. A staggering
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87 % of homes there saw a projected
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decline. 87 %? I mean, that sounds
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like a market collapse. It does,
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but it's not. ASU expert Mark Stapp
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clarified this. It's not really
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a loss of intrinsic value. It's
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more about the expectation gap.
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The gap. Sellers just can't get
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the inflated prices their neighbors
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got two years ago. They're stuck.
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Stuck between what they think their
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houses worth and the reality of
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what a buyer can afford with high
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interest rates. Precisely. So let's
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connect the dots for the contractor.
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You've got 87 % of sellers who are
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disappointed and you've got, get
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this, 64 .6 % of sales in October
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2025 going under list price. Over
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half. Way over half. So sellers
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have three choices. Drop the price.
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Pull the listing and wait. Or...
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Invest strategically. Invest strategically
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to justify a stable price. Okay,
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but let me push back on that for
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a second. Is a renovation truly
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a safer bet than just dropping the
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price by, say, 20 grand? Because
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buyers are also cautious about borrowing
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more in this environment. Why spend
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30 ,000 balls on a new kitchen?
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That's the crucial question. And
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the answer is in high ROI, targeted
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upgrades. Things that directly address
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buyer fears or boost efficiency.
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So not just cosmetic stuff. No.
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A general price drop just attracts
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lowball offers. A targeted renovation
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attracts a serious buyer who sees
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a home that's move -in ready with
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low future costs. Think about Arizona's
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climate. The heat. Right. Investing
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in a high -efficiency HVAC, a new
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heat pump, better insulation. that
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immediately lowers the buyer's future
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bills. That can offset the higher
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mortgage payments. So we're talking
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about efficiency necessary repairs,
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not, you know, extravagant custom
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additions. Absolutely. The focus
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is on fixing the functional things
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that make a buyer hesitate. Minor
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bathroom remodels, smart home tech,
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curb appeal, and critically, those
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energy efficiency upgrades. Things
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that have a real appraisable impact.
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Exactly. It bridges that expectation
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gap. It stabilizes the price. This
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signals a decisive market shift
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away from speculative new builds
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and sharply toward renovation, remodeling
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and upgrades. So the message to
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contractors is market your ability
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to deliver verifiable ROI, not just
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a pretty new kitchen. That's the
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play. The decline in expected value
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equals an increase in strategic
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renovation budgets. OK, so that's
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a huge insight. Now let's shift
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gears. Let's do it. Here's where
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we move from, you know. managing
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seller expectations to capitalizing
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on massive public policy shifts.
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We've been looking at signals from
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Arizona PBS, specifically their
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show Energy Switch. And Energy Switch
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is more than just a TV show. It's
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a direct window into the priorities
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of government, academia, and the
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big industrial players. When they
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spend an entire season debating
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a topic, it means a wave of contracts
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and spending is coming. It's a guarantee.
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So we're not just watching for our
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own enlightenment. We're watching
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for the scope of work. What signals
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are flashing green right now for
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specialized contractors? The planned
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Season 7 topics are basically a
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contractor's roadmap. You're talking
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about decarbonization, data centers,
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extreme weather, and alternative
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energy strategies. Okay, let's start
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with decarbonization. That sounds
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theoretical. It's not, though. It's
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driven by real estate and municipal
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mandates to reduce the carbon footprint
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of commercial and industrial buildings.
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Right, but what does that translate
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to on the ground? A building owner
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doesn't just call a GC and say,
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I need some decarbonization. No,
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they don't. It translates to specialized,
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high -expertise contracts. This
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is a clear signal for contractors,
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especially mechanical, electrical,
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and specialty GCs, to invest in
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certifications. What kind of certifications?
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We're talking NABCP for solar, LE
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decreditation for design -build
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firms, expertise in large -scale
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battery storage. These big commercial
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retrofit contracts are going to
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demand these specific skills. So
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the general contractor who just
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bids low on a standard office build
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-out is going to miss this whole
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wave. Completely. Yeah. You need
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to be able to talk about certifications
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solar integration, and energy management
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with real authority. It's a pivot
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from low -bid commodity work to
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high -value technical execution.
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And what about the other topics,
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data centers and extreme weather?
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That's the other side of the coin.
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Data centers are mission critical.
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Their construction demands a whole
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different level of resilience. You
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mean robust building methods. Precisely.
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High -capacity electrical, sophisticated
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fire suppression, redundant cooling
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systems that can handle Arizona's
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heat. This isn't just standard construction.
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It's highly engineered. And the
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extreme weather focus just reinforces
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that need for resilience, right?
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Building things that can withstand
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those climate risks we talked about
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earlier. Waste all connects. It
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demands specialized engineering.
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If you're a mid -sized or large
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firm, this signals a massive opportunity
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in robust commercial and industrial
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projects. So we've covered the renovation
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shift and the infrastructure demands.
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What does this all mean beyond the
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mechanics and the policy? This gets
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us to, I think, the most important
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asset any contractor has. Your brand.
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Your community brand and legacy.
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In a crowded market, you have to
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stand out. And this is where the
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Arizona construction community provides
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just a brilliant blueprint. We looked
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at the Phoenix Children's event,
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the Big Dig for Kids, presented
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by SUNDT. I love this story. It's
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more than a fundraiser. It's a masterclass
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in building your reputation and
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recruiting your future workforce.
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It's just the perfect blend of philanthropy
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and pure excitement. I mean, imagine
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being a kid getting to safely operate
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real heavy equipment, excavators,
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dozers. You're making construction
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real and exciting for the next generation.
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And the return on investment for
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their reputation, you can actually
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quantify it. It's massive. The event
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has raised over $5 million for pediatric
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cancer research since 2016. In 2024
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alone, it was over $1 .1 million.
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And they had over 2 ,000 participants,
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500 volunteers. And over 60 pieces
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of construction equipment donated
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for the day. 60 pieces of heavy
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machinery. That's a huge commitment.
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We're talking major firms like Sun,
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PCL Construction, Kinney Construction
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Services, Empire Cat, Skanska. When
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these giants... commit that much
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time and that many resources, it's
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a strategic triple win. Okay, what
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are the three wins? First, you're
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fulfilling philanthropic goals.
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Second, you're building an overwhelmingly
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positive local brand. And third,
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and this is the most critical part.
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Workforce development. Workforce
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development. In a time when labor
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shortage is the biggest threat to
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growth, you are giving a future
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operator or engineer their first
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positive hands -on experience. It's
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genius. It's recruiting 101, but
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it's disguised as charity. And for
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any firm, regardless of size, participating
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in something like this. Leveraging
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your equipment and expertise is
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essential for visibility. It keeps
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that talent pipeline full. So we've
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covered the three pillars of opportunity
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then. The market shift to high ROI
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renovation, the specialized infrastructure
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demands from decarbonization, and
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the need to build a powerful community
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brand. Those are your high leverage
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areas right now in the Arizona market.
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Absolutely. High value residential
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retrofits, specialized green infrastructure,
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and community focused brand building.
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And, you know, that leads to a final
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thought for you to chew on. If the
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biggest construction firms in Arizona
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are leveraging their largest assets,
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their actual excavators and loaders
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for community impact, how could
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your current equipment inventory
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be leveraged philanthropically this
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quarter? Don't let the compliance
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And that's exactly why we partner
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with Smart Business Automator. They
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provide the tools to simplify those
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complex, construction -specific
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workflows. You can automate your
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quoting for those renovation jobs,
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streamline compliance for the green
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contracts, and manage the complex
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scheduling for a data center build.
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It lets you manage the high leverage
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work without all the desk time.
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So if you are ready to reclaim your
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schedule and focus on winning those
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high -value Arizona contracts we
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just discussed, you know what to
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do. Visit www .smartbusinessautomator
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.com. Stop drowning in admin work.
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Automate your business so you can
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stay on the job site. Thanks for
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00:12:40,570 --> 00:12:42,309
listening to The Deep Dive. Let's
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00:12:42,309 --> 00:12:42,870
get back to work.
00:00:01,220 --> 00:00:03,600
We are finally back from our mid
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-season break. We are back. It feels
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fantastic to be in the studio, and
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we are kicking off the second half
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of the season with a deep dive that's
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incredibly specific. And most importantly,
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actionable. Especially for our listeners
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in Arizona. Yes. If you are a construction
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business owner or a project manager
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in the Grand Canyon State, this
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is basically your roadmap for the
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next, what, 18 months? Absolutely.
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Our mission today is laser focused.
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We've taken a whole stack of sources.
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We're talking Zillow reports, public
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energy programming, even local charity
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stuff. And we're pulling out the
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concrete business opportunities
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for contractors. Exactly. We're
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analyzing the data to find the clear
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signals for where your next profitable
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contracts are going to come from.
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We are essentially mapping. the
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future job site, reading between
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the lines. But before we dig into
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all that, the Zillow expectation
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gaps, the green energy signals,
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we have to recognize the partner
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that makes this all possible. That's
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right. Today's episode is brought
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to you by smartbusinessautomator
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.com, the operations engine behind
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modern construction firms that want
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to scale smarter, not harder. If
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you're dealing with project delays,
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chaotic scheduling, drop balls on
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follow -ups or manual bottlenecks,
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Smart Business Automator helps you
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automate back office workflows and
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change order follow -ups, streamline
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subcontractor coordination and client
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communication, track bids, leads,
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and financials in one clean dashboard.
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Free up your time to focus on building,
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hiring, and closing bigger deals.
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Because in construction, scale without
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systems is just stress. Now. Let's
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deep dive. We're back. And so is
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our partner, Smart Business Automator.
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And they get it. They understand
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that the larger and more complex
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the contract, like the ones we're
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about to talk about, the more crushing
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the administrative side becomes.
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Oh, for sure. We'll show you later
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how they cut through all that noise
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so you can actually focus on winning
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the contracts we're identifying
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right now. Okay, let's do it. Okay,
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so let's untack this. We are starting
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with the Arizona residential market.
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We're pulling data from Zillow,
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some analysis from ASU experts.
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And the big question we're trying
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to answer for you is this. With
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all the current volatility, should
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you be doubling down on new builds?
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Or is it time for a strategic pivot
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to renovations? The pivot. That's
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the key word. And the data, well,
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it strongly suggests a pivot is
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necessary. If we look at the latest
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Zillow Home Value Index through...
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November 30, 2025. Right. The average
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Arizona home value is sitting at
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about $417 ,000. Okay. Still a hefty
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number. It is. But here's the key
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data point. The one -year value
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change, it's down 3 .1%. Wow. So
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that rapid acceleration we saw for
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years hasn't just stalled, it's
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actually reversed. It's reversed.
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And this isn't just an Arizona thing.
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Oh, it's a national trend. Nationally,
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Zillow found that over half of U
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.S. homes lost value in the past
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year. That's the highest percentage
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we've seen since, what, 2012? Right,
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since the recovery started. And
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Arizona is right in the thick of
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it. The West and the South saw the
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biggest slowdowns. And that's partly
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due to more houses being available,
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but also climate risks. Things like
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wildfires and extreme heat. are
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starting to really influence insurance
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markets. It's a fascinating dynamic,
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though, because the underlying economy
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is still pretty strong. Very strong.
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You look at data from groups like
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the Black Chamber of Arizona, you
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see huge growth in people coming
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in with jobs in tech, banking, manufacturing.
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So the economy is solid. People
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aren't fleeing the state. Demand
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for housing is still there. Exactly.
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And that's the context, right? It
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explains why sellers are so stubborn.
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They know the demand exists. But
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the high interest rates are forcing
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buyers to be much more cautious.
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More demand. Much more demanding.
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And that brings us right to Phoenix,
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where the renovation signal is just...
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ringing loud and clear. Okay, so
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Phoenix specifically. Phoenix ranked
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high among cities with a decline
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in value expectations. A staggering
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87 % of homes there saw a projected
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decline. 87 %? I mean, that sounds
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like a market collapse. It does,
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but it's not. ASU expert Mark Stapp
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clarified this. It's not really
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a loss of intrinsic value. It's
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more about the expectation gap.
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The gap. Sellers just can't get
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the inflated prices their neighbors
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got two years ago. They're stuck.
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Stuck between what they think their
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houses worth and the reality of
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what a buyer can afford with high
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interest rates. Precisely. So let's
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connect the dots for the contractor.
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You've got 87 % of sellers who are
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disappointed and you've got, get
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this, 64 .6 % of sales in October
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2025 going under list price. Over
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half. Way over half. So sellers
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have three choices. Drop the price.
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Pull the listing and wait. Or...
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Invest strategically. Invest strategically
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to justify a stable price. Okay,
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but let me push back on that for
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a second. Is a renovation truly
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a safer bet than just dropping the
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price by, say, 20 grand? Because
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buyers are also cautious about borrowing
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more in this environment. Why spend
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30 ,000 balls on a new kitchen?
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That's the crucial question. And
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the answer is in high ROI, targeted
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upgrades. Things that directly address
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buyer fears or boost efficiency.
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So not just cosmetic stuff. No.
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A general price drop just attracts
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lowball offers. A targeted renovation
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attracts a serious buyer who sees
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a home that's move -in ready with
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low future costs. Think about Arizona's
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climate. The heat. Right. Investing
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in a high -efficiency HVAC, a new
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heat pump, better insulation. that
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immediately lowers the buyer's future
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bills. That can offset the higher
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mortgage payments. So we're talking
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about efficiency necessary repairs,
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not, you know, extravagant custom
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additions. Absolutely. The focus
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is on fixing the functional things
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that make a buyer hesitate. Minor
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bathroom remodels, smart home tech,
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curb appeal, and critically, those
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energy efficiency upgrades. Things
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that have a real appraisable impact.
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Exactly. It bridges that expectation
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gap. It stabilizes the price. This
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signals a decisive market shift
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away from speculative new builds
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and sharply toward renovation, remodeling
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and upgrades. So the message to
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contractors is market your ability
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to deliver verifiable ROI, not just
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a pretty new kitchen. That's the
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play. The decline in expected value
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equals an increase in strategic
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renovation budgets. OK, so that's
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a huge insight. Now let's shift
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gears. Let's do it. Here's where
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we move from, you know. managing
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seller expectations to capitalizing
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on massive public policy shifts.
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We've been looking at signals from
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Arizona PBS, specifically their
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show Energy Switch. And Energy Switch
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is more than just a TV show. It's
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a direct window into the priorities
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of government, academia, and the
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big industrial players. When they
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spend an entire season debating
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a topic, it means a wave of contracts
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and spending is coming. It's a guarantee.
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So we're not just watching for our
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own enlightenment. We're watching
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for the scope of work. What signals
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are flashing green right now for
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specialized contractors? The planned
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Season 7 topics are basically a
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contractor's roadmap. You're talking
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about decarbonization, data centers,
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extreme weather, and alternative
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energy strategies. Okay, let's start
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with decarbonization. That sounds
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theoretical. It's not, though. It's
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driven by real estate and municipal
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mandates to reduce the carbon footprint
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of commercial and industrial buildings.
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Right, but what does that translate
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to on the ground? A building owner
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doesn't just call a GC and say,
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I need some decarbonization. No,
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they don't. It translates to specialized,
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high -expertise contracts. This
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is a clear signal for contractors,
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especially mechanical, electrical,
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and specialty GCs, to invest in
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certifications. What kind of certifications?
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We're talking NABCP for solar, LE
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decreditation for design -build
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firms, expertise in large -scale
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battery storage. These big commercial
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retrofit contracts are going to
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demand these specific skills. So
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the general contractor who just
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bids low on a standard office build
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-out is going to miss this whole
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wave. Completely. Yeah. You need
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to be able to talk about certifications
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solar integration, and energy management
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with real authority. It's a pivot
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from low -bid commodity work to
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high -value technical execution.
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And what about the other topics,
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data centers and extreme weather?
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That's the other side of the coin.
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Data centers are mission critical.
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Their construction demands a whole
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different level of resilience. You
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mean robust building methods. Precisely.
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High -capacity electrical, sophisticated
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fire suppression, redundant cooling
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systems that can handle Arizona's
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heat. This isn't just standard construction.
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It's highly engineered. And the
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extreme weather focus just reinforces
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that need for resilience, right?
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Building things that can withstand
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those climate risks we talked about
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earlier. Waste all connects. It
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demands specialized engineering.
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If you're a mid -sized or large
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firm, this signals a massive opportunity
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in robust commercial and industrial
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projects. So we've covered the renovation
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shift and the infrastructure demands.
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What does this all mean beyond the
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mechanics and the policy? This gets
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us to, I think, the most important
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asset any contractor has. Your brand.
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Your community brand and legacy.
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In a crowded market, you have to
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stand out. And this is where the
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Arizona construction community provides
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just a brilliant blueprint. We looked
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at the Phoenix Children's event,
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the Big Dig for Kids, presented
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by SUNDT. I love this story. It's
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more than a fundraiser. It's a masterclass
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in building your reputation and
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recruiting your future workforce.
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It's just the perfect blend of philanthropy
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and pure excitement. I mean, imagine
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being a kid getting to safely operate
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real heavy equipment, excavators,
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dozers. You're making construction
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real and exciting for the next generation.
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And the return on investment for
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their reputation, you can actually
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quantify it. It's massive. The event
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has raised over $5 million for pediatric
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cancer research since 2016. In 2024
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alone, it was over $1 .1 million.
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And they had over 2 ,000 participants,
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500 volunteers. And over 60 pieces
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of construction equipment donated
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for the day. 60 pieces of heavy
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machinery. That's a huge commitment.
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We're talking major firms like Sun,
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PCL Construction, Kinney Construction
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Services, Empire Cat, Skanska. When
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these giants... commit that much
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time and that many resources, it's
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a strategic triple win. Okay, what
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are the three wins? First, you're
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fulfilling philanthropic goals.
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Second, you're building an overwhelmingly
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positive local brand. And third,
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and this is the most critical part.
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Workforce development. Workforce
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development. In a time when labor
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shortage is the biggest threat to
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growth, you are giving a future
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operator or engineer their first
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positive hands -on experience. It's
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genius. It's recruiting 101, but
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it's disguised as charity. And for
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any firm, regardless of size, participating
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in something like this. Leveraging
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your equipment and expertise is
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essential for visibility. It keeps
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that talent pipeline full. So we've
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covered the three pillars of opportunity
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then. The market shift to high ROI
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renovation, the specialized infrastructure
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demands from decarbonization, and
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the need to build a powerful community
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brand. Those are your high leverage
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areas right now in the Arizona market.
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Absolutely. High value residential
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retrofits, specialized green infrastructure,
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and community focused brand building.
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And, you know, that leads to a final
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thought for you to chew on. If the
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biggest construction firms in Arizona
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are leveraging their largest assets,
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their actual excavators and loaders
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for community impact, how could
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your current equipment inventory
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be leveraged philanthropically this
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quarter? Don't let the compliance
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And that's exactly why we partner
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with Smart Business Automator. They
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provide the tools to simplify those
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complex, construction -specific
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workflows. You can automate your
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quoting for those renovation jobs,
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streamline compliance for the green
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contracts, and manage the complex
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scheduling for a data center build.
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It lets you manage the high leverage
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work without all the desk time.
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So if you are ready to reclaim your
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schedule and focus on winning those
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high -value Arizona contracts we
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just discussed, you know what to
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00:12:31,049 --> 00:12:34,389
do. Visit www .smartbusinessautomator
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00:12:34,389 --> 00:12:36,730
.com. Stop drowning in admin work.
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Automate your business so you can
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00:12:38,549 --> 00:12:40,570
stay on the job site. Thanks for
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00:12:40,570 --> 00:12:42,309
listening to The Deep Dive. Let's
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get back to work.
