For the past five years Avid has conducted an annual survey of recent homebuyers asking what features they’d be interested in if they were to build or buy a new home again. This Design Driver study consistently reveals insights that builders can use to better align their products with the expectations of the marketplace.
Paul Cardis, Avid’s founder and CEO, sat down with me to discuss the most recent survey and what it tells us about the re-emerging new home market.
The Kitchen is (still) King
For the past few years Avid’s surveys have shown that kitchens are a priority among homebuyers. “In this era of trying to ‘lean up’ the home, builders should take care in the kitchen,” says Cardis. “Islands, granite countertops, walk-in pantries and lots of space for entertaining are still ‘must haves.’ Also, when the recession hit we saw interest in dining rooms skyrocket. We compared that with restaurant data and saw that people were eating out less and entertaining at home more. However, that trend seems to be reversing now that the economy has begun to recover somewhat.”
The Emergence of Green
“Major homebuilders such as Meritage and KB Homes are taking big steps toward green. In the U.S. and Canada we’re finding that buyers want more energy efficiency.” While this is relatively new in the U.S., Cardis says this trend is more established in Canada, where builders have been building more efficient homes for several years. This is one of the Top 10 requests of buyers on both sides of the border, says Cardis. “They want a home that is basically going to cost less to operate.”
“One of the options that buyers are saying they want pre-installed is ceiling fans,” the survey indicated. Builders often leave these and other small options out to keep costs down, buy homebuyers it seems homebuyers are less inclined to have these things added after the purchase; they want everything done before they move in.
The lesson for builders is that homebuyers are still willing to pay for convenience – if they can see and justify the value. As energy efficiency continues to remain a priority, these options will continue to be in demand.
However, other aspects of green construction, such as products made from recycled and renewable materials, or alternative energy generation – geothermal, solar and wind – are not yet on buyer’s radar. For the most part, buyers are not willing to invest in green technologies that have more than a 5-year pay back.
As space becomes an issue in today’s smaller floor plans, the home office remains taboo – buyers will compromise in other areas, but not the office. “That should come as no surprise,” Cardis reflects. “If you look at what’s happening in the corporate world, companies are using less office space and expecting more of their employees to work from home.”
Room to Roam
In terms of community features, walking paths scored high in the survey, too. “In the context of the recession, people said that they could do without golf courses and health clubs and all the fancy amenities that were in new communities. They were clearly saying that they didn’t need those things because they didn’t want to pay for them. But people do want low maintenance walking paths and parks in their communities.”
Smaller is Better
The trend toward smaller homes continues, but how the space is used is continually evolving. Avid’s survey indicates that single-use spaces, such as theater rooms, craft rooms and second suites, are being forfeited for more flexible spaces. Even demand for the venerable mudroom has waned, reports Cardis.
Do Your Research
“Homebuilding is a local business, so there’s no substitute for local research,” says Cardis. “The general market study helps us to see national trends, but those trends change when you get down to the local level.”
Cardis recommends that builders find a reputable company that knows their market and can do direct consumer surveys. Where there are generic studies available, he cautions against these. “If you really want to dial in to your market, do your own primary study. In reality, it’s not that expensive,” ranging from around $5,000 to upwards of $15,000 for more in-depth research. “At the end of the day, it’s money well spent. You’ll be able to ask questions that are relevant to you market and really keep your finger on the pulse of what your buyers will respond to.”
For more information on Avid’s services, visit www.AvidRatings.com.