What Do Home Buyers Want in Their Next Home?

As the housing market strengthens, it is a great time to think about what you want in your next new home. We’ve all seen a stunning hillside mansion and dreamed what it would be like to raise our families there. Or envied the amazing renovation makeovers depicted on television shows that give the home owners a sense of pride and accomplishment. But how does your dream home compare to what home buyers across the country are looking for in their new home?

 A recent study from the National Association of Homes Builders, What Home Buyers Really Want, shared the results of a survey of the preferences of thousands of home buyers. On average, home buyers are looking for a home that is 17 percent larger than their current home, a median of 2,226 square feet. But, likely as a result of the ongoing challenges of the economic downturn, that size is 13 percent smaller than the average size of homes started in 2012.

 The layout of the home is more important than the location to most buyers. Living space and number of rooms was ranked the most influential characteristic by 65 percent of buyers, while only 33 percent ranked proximity to locations they need to go as tops. A sense of open space continues to be popular, with about three-quarters of home buyers wanting a kitchen that is open to the family room, and nearly two-thirds looking for ceilings on the first floor that are 9 feet or more tall.

 Some of the most wanted features in a home involve saving energy. Energy Star-rated appliances were rated as essential or desirable by 94 percent of respondents, and 91 percent wanted an Energy Star rating for the whole home. In fact, nine out of ten buyers would rather buy a home with energy-efficient features and permanently lower utility bills than one without those features that costs 2 percent to 3 percent less.

 Convenient organization and storage is another home buyer favorite. More than 80 percent of the respondents said they wanted walk-in pantries and pull-out shelves in the kitchen, a laundry room and storage in the garage.

 Today’s home buyers want the latest technology. While only 15 percent of home owners currently have a wireless home security system, 50 percent want one. Similar gaps in “have” versus “want” occur with security cameras, lighting control and wireless audio systems, and multi-zone HVACs.

 The most unwanted home features include elevators, a location in a golf course, high density or gated community, and having only a shower stall and no tub in the master bath.

 So whether you’re planning or dreaming about what your next new home will look like, or you’re making renovations to your current home so that it will appeal to its next owner, keep these home buyer preferences in mind! 

April is New Homes Month

April is New Homes Month. Why would there be a new homes month? The only people who benefit when a house is built are the family members who get to live there, and the builder who constructed and sold the home, right?

Wrong. The positive impact of new residential construction is far-reaching, bringing benefits to families, businesses and services throughout a community immediately, as well as for years to come. It’s important to recognize this during New Homes Month.

According to economists at the National Association of Home Builders, the one-year estimated local impacts of building 100 single-family homes in a typical metro area include $21.1 million in local income, $2.2 million in taxes and other local government revenue, and 324 local jobs.

But what does that economic impact mean in the real, day-to-day lives of community residents?

Just think about it. When a family moves to a community and buys a new house, they will likely shop at local stores to buy furniture and accessories to decorate the home. They will fill their car’s gas tank at local gas stations so they can get to the stores, have local mechanics work on the car when it breaks down or needs the oil changed, or buy a new car at a local dealer when it’s time to replace the old one.

The family may need to hire local companies for regular services to maintain their home, such as landscaping, house cleaning, pet sitters or pool upkeep.

The children will enroll in local schools. This increases enrollment, meaning more teachers, janitors, cafeteria workers and other school support staff will need to be hired. Those kids will also join sports leagues and other activities, buy equipment and pay registration fees that provide stipends for referees and coaches.    

All of this economic activity puts income into the pockets of local business owners and their families, who can then afford to go out and spend money themselves, which recycles even more money into the community’s economy.

The new family also pays local and state taxes. These tax revenues help pay for a wide range of government services, including school teachers, police departments, refuse collection, parks maintenance and road repairs.

Over the long term, as the families who move into new homes become part of the community, their positive impact continues. NAHB estimates that those 100 new homes also provide the community with additional, annually-recurring impacts of $3.1 million in local income, $743,000 in taxes and other revenue for local governments, and 53 local jobs.

Families who buy a newly built home enjoy benefits including safety, amenities, energy efficiency and floor plans to fit a modern lifestyle. But the advantages of new homes extend far beyond the buyers and the builders—residential construction has a positive, direct impact on the local community for years.

April is New Homes Month and provides a great opportunity to learn about the benefits of buying a newly built home. 

Eisenberg: Reasons to be Optimistic

By Eliot Eisenberg, Ph.D.

While economic growth has been lackluster since the end of the recession in summer 2009, this is likely to change, despite the sequester.  Here are my top four reasons why, in rank order of their importance to the economy going forward. 

The painful process of deleveraging is over.  Deleveraging is, in part, what caused this recession to be so painful compared with all other post-WWII recessions.  Non-financial corporations have outstanding balance sheets, and have actually begun to releverage.  Commercial and industrial loans are once again on the rise and the banking sector is healthier than it has ever been since record keeping began.  To give just one indicator, the core capital ratio of banks is 9.2%; the post WWII average is 7.5%. Households are pretty good shape too.  There are now only about nine million households seriously behind on some sort of payment.  At the peak of the recession, the number was 20 million, while now credit card and auto loans and personal loan defaults are all profoundly low.  The surprisingly rapid rate of deleveraging is partly why the housing sector is now recovering much faster than expected.     

The housing market has turned the corner and the next few years should be excellent.  At their weakest, housing starts were 550,000 units/year.  They are now at 900,000 and should grow by 200,000 units/year for the next three to four years, topping out at about 1.7 million units in 2016. This is being driven by a rise in household formations that were delayed due to the anemic job market.  Note that each new home creates about 5 new jobs nationwide, so 200,000 new homes means a million new jobs.  And while there are still about three million first mortgages in foreclosure, that number is way down from where it was and is on its way to the 750,000 mark, which is the historic norm.

The next reason I am optimistic is because US corporations are profoundly competitive and have drastically lowered their costs.  As a result, they are now able to compete with firms anywhere and win.  Unit labor costs are way down.  In the manufacturing sector, they are back to where they were 20 years ago, and as a result corporate profits have been setting records quarterly.  Productivity is so high firms that would not have previously considered manufacturing here (like Apple) are now taking a second look.      

Lastly, despite severe dysfunction on Capitol Hill, substantial progress has been made on the fiscal front.  The cumulative impact of the tax increases and spending cuts enacted in spring 2011, during the debt-ceiling fiasco of late summer 2011, the recently completed New Year’s Day fiscal-cliff negotiations, along with the most recent sequester have come close to stabilizing our public debt-to-GDP ratio somewhere in the 75% to 78% range.  With another $500 billion in spending cuts and or tax increases over the next decade, we will be done. 

Our economy has come a long way.  The worst is over and by the end of the year the economy will hopefully look a lot different than it does now.  And housing will be leading the way. 

Elliot Eisenberg, Ph.D. is President of GraphsandLaughs, LLC and can be reached at Elliot@graphsandlaughs.net.  His daily 70 word economics and policy blog can be seen at www.econ70.com.

BIALAV Launches Be Smart Buy New Campaign

The Building Industry Association of South California’s Los Angeles/Ventura Chapter (BIASC/LAV) announced that for 17 days in March, homebuilders will be offering substantial savings and special opportunities on the most desirable new homes in Los Angeles and Ventura counties. The chapter’s Be Smart Buy New promotion will feature more than 30 new home communities throughout the region.

From Friday, March 1 through Sunday, March 17, participating homebuilders will be passing along big savings to homebuyers to help them buy the homes of their dreams for less. From design options to livability, to energy efficiency, construction techniques and more, there are countless reasons to choose new when searching for a home. To view a listing of all of the participating new home communities, visit BeSmartBuyNew.com.

“Homebuilding is back in Southern California and this is the event we have all been waiting for,” said Holly Schroeder, CEO of the Los Angeles/Ventura County Chapter of the BIASC. “It’s truly an unprecedented sales event with dozens of new-home communities participating all over Los Angeles and Ventura counties. Combined with historically low interest rates and the steady increase in home prices, now is the time to buy a new home.”

Be Smart Buy New will feature a diverse collection of 14 homebuilders with offerings at more than 30 new home communities.  Homebuilders include:

• Brookfield Homes
• California Home Builders 
• DR Horton
• KB Home
• LA Urban Homes
• Lennar
• The New Home Company
• Newhall Land
• TRI Pointe Homes
• Pardee Homes
• Toll Brothers
• Watt Communities
• William Lyon Homes
• Williams Homes

A new home offers seemingly endless benefits when compared to a re-sale house. Here are the top five reasons to purchase a new home:

1. Build it your way

New homes offer homebuyers choices that used homes can not offer. Buyers can select cabinets, countertops, flooring and more that complement their tastes and design styles.

1. Select your perfect floorplan

New homes offer buyers choice. Select the perfect floorplan that fits your lifestyle and meets your needs.

1. Energy efficiency

Today’s new homes are constructed with modern products and include features that help conserve valuable energy. They are far more energy efficient than homes constructed just 10 years ago. New homes will save you money every month.

1. Warranties

New homes offer the latest technology in building materials that are typically under a limited warranty from the homebuilder. Used homes likely have products and materials that may need to be replaced.

1. Safety and Indoor Air Quality

Today’s new homes are constructed with products that use the latest in technologies to increase indoor air quality. The homes meet strict standards and codes that were not in place years ago, keeping you safe.

Join the interest list now for a chance to win a $100 Amazon gift card. One winner will be chosen each day during the Be Smart Buy New promotion March 1 through March 17. Registrants will be among the first to receive important information and updates from BIASC/LAV and from homebuilders regarding the campaign. Visit besmartbuynew.com to register.

Visitors to the model homes in the more than 30 new home communities participating in the Be Smart Buy New promotion could be one photo away from winning one of three $1,000 Pottery Barn shopping sprees. Guests are encouraged to take a photo of their favorite room, backyard or even of themselves and upload it onto the Be Smart Buy New Facebook page, tweet it with hashtag #besmartbuynew or share it on Instagram with hashtag #besmartbuynew in the comments to be eligible. A drawing for the gift cards will be held on March 22.

BIA/LAV Holds Installation & Awards Event

The Los Angeles/Ventura Chapter of the Building Industry Association of Southern California will hold its annual installation event on Thursday, November 8, from 5:30 to 7:30 p.m. at the Skirball Cultural Center, 2701 N. Sepulveda Blvd. in Los Angeles.

 The event this year will honor incoming Chapter President Aleks Baharlo and the 2013 Board of Directors. Baharlo is president of KFG Investment Company, a development company with holdings in Los Angeles, Ventura and Santa Barbara Counties. Barholo will be installed as Chapter President by Michael Keston, a past BIALAV president. Keston is the founder of Larwin Company and KFG Investment Co, as well as Chair of the USC Keston Institute.

 The event also recognizes the contributions of the outgoing Board of Directors and 2012 Chapter President Jonathan Lonner, who worked tirelessly this year to keep the Chapter’s advocacy programs running smoothly during the longest downturn in housing construction in more than a half-century. Lonner is principal with Burns & Bouchard, a Los Angeles-based boutique land-use and government affairs firm specializing in creative solutions to today’s complex development issues.

 Also being recognized are the Chapter’s Builder of the Year, California Home Builders, and the Associate of the Year, Champion Windows.

 California Home Builders is a Los Angeles-based company that specializes in developing and building residential communities, multifamily projects and luxury custom homes.  Since our establishment in 1994, CHB has built hundreds of homes and multi-family units in Los Angeles and Ventura Counties.  This year, California Home Builders completed the first community in the City of Los Angeles with a solar electric generating systems as a standard feature. This 57 home community was build and sold in a mere 9 months. California Home Builders maintains and active and diverse portfolio of projects, completing 2 condominium projects in the past year, with 3 more in the works while also working on 3 additional single family home projects and an apartment complex.

 Sponsors and supporters of the event include California Home Buidlers, Cheryl & Haim Saban, Standard Pacific Homes, Williams Homes and Zillow.

 The cost is $125 for an individual and $225 for a couple, and sponsorship opportunities are still available. The registration form is available at www.bialav.org. For more information, e-mail Katy Williams at kwilliams@bialav.org or leave her a message at (661) 257-5046, ext. 2.