Living Large on a Smaller Budget: Designing Homes for the New Economy

doris2-147x174dougBuilderRadio Interviews Doris Pearlman and Doug Van Lerberghe.

The Realtor that lives up the street from me has been driving Ford Expeditions since they first came out, trading every couple of years for a new one.  Last week she waved as she passed by in her new Ford Escape hybrid.

It’s true:  Standards change with the times.

What has happened to Detroit metal is carrying through into the housing industry.  Survival will mean adjusting our product to fit a new economy, emerging trends, and changing lifestyles.

“Everybody has had to confront how to live differently in a challenging economic time.  If we bury our heads in the sand none of us will get anyplace.  I think it’s important that we put all of the issues on the table so we can come up with solutions that will work for homebuilders across the country,” says Doris Pearlman, an interior designer and owner of  Possibilities for Design in Denver, CO.

Doug Van Lerberghe, an architect with the firm KEPHART, also in Denver, agrees:  “It all comes down to the ability to finance.  Builders are looking for ways to decrease the size of the home without having a major impact on the psyche of the buyers,” he says.  “Where the average home size was around 2,000 sq. ft. a year ago, we’re seeing that as much as 20% down.  It’s driven by what mortgage payment people can afford; people will adjust their lifestyles to accommodate that smaller home.  Our goal as architects and interior designers is how to make that smaller home live large and live well.  That’s our challenge.”

To meet that challenge, Van Lerberghe suggests exploring options such as:

  • Develop with a vision. “Builders that start with land that has intrinsic value have an advantage,” he says.  Find the natural features of your property and develop your lot plan around those.  That will make the community more livable, even with smaller homes and lots.
  • Land planning. Smaller lots and smaller setbacks can reduce costs, and proper site orientation can make up the difference by yielding more useable outdoor space and contribute to reduced heating/cooling costs.
  • Home Design. Bring in a livability expert – an interior designer or merchandiser – early in the design process to make sure the space is used properly and floor plans are functional and reflect how your buyers will live in the home.

Conflicting Aspirations.
Pearlman agrees.  “We’re seeing a conflict of aspirations right now.  People want the same house they’ve been used to, but economics have caused buyers to re-access and re-prioritize their aspirations, wants and needs.  So, we’ve tried to create a program that will maintain the quality, but will cut significant cost out of the builder’s merchandising program.”

To accomplish this, Pearlman and Van Leberghe offer these suggestions for cutting costs and enhancing livability in smaller homes:

Paint instead of trim. “Paint details create character and interest and draw the eye to the architecture, and still cost way less than expensive trim.”

Cabinetry and countertops. “Granite is the countertop that we know impresses the buyer, but do you have the budget for granite or do you need to look for alternatives?  There are laminates that will create an effect and that, cleverly used, can give a good impression.”

Reallocation of  Space.  Formal living rooms and dining rooms are an expensive luxury.  Buyers are forgoing those areas to make room for more livable, usable space.

Cleaner styled furnishings.  “Because you have a smaller space, you don’t want to overwhelm it with a very large piece of furniture.  So, we’re seeing cleaner, crisper, straighter-lined furniture.”

Minimalize Accessories. “People are paring down the amount of accessories in their homes.  Fewer, but larger accessories are in, and ‘tchotchkes’ and knickknacks are out.”

Keep Current with Colors. “The ‘color of the year’ right now is purple as an accent color.  We’re also seeing a lot of blue coming into the design pallet.  Beiges are being replaced with grays.  Yellow is becoming popular as an accent color, and we’re seeing white making a comeback on furniture and furnishings, and even on walls in contemporary settings.  Color creates perceived value.”

Community Facilities. As homes grow smaller, the community clubhouse will be used more for entertaining. Pearlman recommends that your clubhouse be outfitted with upgrade surfaces, including a kitchen with state of the art appliances, for owner’s use.

Outdoor areas. “That’s a pretty affordable space, and with the right planning can act as a seasonal extended living area,” adds Van Leberghe.

The Cost Challenge.
No matter how you tweak a home to get the most usable space, “there will still be one kitchen and two bathrooms,” says Van Leberghe.  “Those are the most expensive parts of the house.  So, the square foot cost comes in higher.  So that’s our challenge as designers and builders – how do you make that smaller home look as good as the larger home, and still bring it in at the same relative price?

“Also, as we design homes they have to feel well; they have to be well lit; they have to compliment the buyer’s lifestyle.  Flexibility in the design is very critical.  People are staying home more and entertaining more; they’re ‘cocooning.’  So I think kitchens are even more important now than they were a year ago.”

Yes, standards are changing with the times, and herein lay the opportunities for homebuilders:  New standards make the old ones obsolete.  Every existing home was built to a standard that is now dated.  Only a new home will meet the family, emotional and social needs of the current market.  Pearlman and Van Leberghe offer a glimpse as to what those new standards are.

The builders who make that adjustment the quickest, offering smaller, less expensive homes with current amenities and style, are the ones whose homes will be in the greatest demand.  Those that don’t are taking an awful risk, akin to still trying to sell a Hummer today as a family car .

Somebody eventually might buy it, but it they’re not going to give you much for it.

___________________________ .

Contact Doris Pearlman at
Contact Doug Van Lerberghe at

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