Friday Round Up 10/16/15

In a segment we’re calling Friday Round Up we gather the most important and interesting stories from around the web as it pertains to home building.

New Single-Family Home Size in 2014: Regional Estimates

Source: Eye on Housing

According to 2014 Survey of Construction (SOC) data from the Census Bureau and NAHB analysis, the median size of new single-family homes started in 2014 was 2,450 square feet, the second highest measure since 2009.

Nonetheless, the post-recession increase in single-family home size is consistent with the historical pattern coming out of recessions. Typical new home size falls prior to and during a recession as some homebuyers cut back, and then sizes rise as high-end homebuyers, who face fewer credit constraints, return to the housing market in relatively greater proportions.

Single family home size by census division

The market share of new single-family homes under 3,000 square feet lay in a rough range of 64% to 75% across Census divisions.

Share of single-family homes under 3,000 square feet

 

Here’s What Pushes People to Buy Homes in 2015

Source: Realtor.com

In a survey of active home shoppers this June and July conducted for realtor.com® through the BDX Home Shopper Insights Panel, we asked what triggered them to start thinking about purchasing a home. Here are the top results!

  1. I’m tired of my house
  2. Interest rates are looking good
  3. Home prices are, well, not bad either
  4. I’ve got more money to spend
  5. The stork is on its way—and it’ll need some room to land

Your Biggest Competition Isn’t Other Builders

Source: Builder Online

In many markets, a new-home builder’s biggest adversary isn’t another builder, it’s another type of home: an existing one. The reality is that there are a number of reasons why a home buyer might prefer a resale house, even one that needs extensive work. So, in the spirit of “getting to know the competition,” let’s look at some of the reasons why.

For instance, the buyer of a resale home may have his or her heart set on moving to a specific urban neighborhood or older suburb where newly constructed houses are rare or non-existent. Or, a resale buyer might be a do-it-yourself aficionado who relishes the opportunity to transform an old house into a dream home, even if it takes considerable time and money.

In these cases, it’s understandable that some home buyers prefer an existing house. But what about other clients who are on the fence about whether a new home is right for them? As you well know, there are considerable advantages to buying a brand new home, so make sure you point them out. Here are a few:

Community amenities: Many new homes are located in master-planned developments with resort-style community centers, large pools, trails, and clubhouses.

Customization: A second advantage of a new home is that the buyer can have input on its design and product selections.

Energy savings: Today’s new homes are far more energy efficient than homes built 10 or 20 years ago, something your customers may not think about.

Low maintenance: Most homeowners prefer to relax and do fun things with their friends or family during their free time. New homes are the obvious choice for this group because they are built with modern systems and components that require less care and maintenance and are engineered to work together for hassle-free living

Less upkeep: A resale home likely has tired products that may soon need replacing. Remind your customers that with an existing home there is always a looming concern of what it’s going cost to replace a roof, appliances, or a water heater.

Financing: Without question, financing is one of the most confusing aspects of the home-buying process. To help customers through this difficult time, partner with mortgage subsidiaries or affiliates to custom-tailor financing and down payment options to each buyer’s specific lending situation.

Resale value: Your buyer may plan to live in his or her next home for many years, but at some point most people sell a home for a multitude of reasons. And when the time comes to move, a five- or seven-year old home will often be more desirable — given all the features above — than a 25-year old home at resale.

When you lay out all the reasons why your new homes are superior to existing ones, you realize how this information can benefit your sales process.

-Author