Investment propertyPerceived Trends in Homebuilding Fuel Fantasies And Provide Solutions
In an eye-opening article of the January 2000 BUILDER Magazine, "A New Dawn",
the magazine staff"s research reveals "Mega-Trends" it predicts will
revolutionize the way builders do business in the new century. Citing the
incredible advancements of the last hundred years, BUILDER sees great things
for the future, but warns that no one should feel that their past successes
are the laurels upon which they should predict future euphoria in the
building industry. Some things will never change, however; " . . it"s all
about good craftsmanship, and that hasn"t changed since the days of the early
hominids. This business is all about finding the right piece of land,
scheduling like the devil, building a quality home, and having the street
smarts to sell it."
Here is a sampling of Mega-Trends BUILDER includes in its predictions:
Demographics
As one of the fastest growing segments of the home-buying market in the
1990s, immigrant and minority households will be changing the face of
American homebuilding. Builders may be doing proverbial paradigm shifts as
to what these groups will buy and whether they want to be "grouped" in
geographic areas at all. According to Bill Ofstrem, a builder surveying land
for future development in San Diego County, "Many ethnic buyers are
second-generation Americans. They do not want to be seen as outsiders."
This growing segment of homebuyers, although proud of their heritage, want to
be treated on a equal plane with the rest of the population, with lifestyle
choices including those incorporated throughout other new developments, such
as golf, tennis, jogging, swimming, or cycling.
According to the article, some subtle changes are being implemented for
various groups according to what may appeal to them. In Atlanta, for
instance, a prosperous African-American population does not seem to demand
more diverse floor plan selections from homebuilders, such as John Weiland
Homes. They do, however, appear to prefer a more custom, European and
sophisticated appearance to their homes" elevations, and builders are
beginning to take note.
With Baby Boomers turning 50 as quickly as we can say …"and how old were you
during the "Age of Aquarius"?" households age 55-64 will be the fastest
growing segment of the home buying sector in the first decade of the new
millennium. This group exercises twice as much as their parents (See "Baby
Boomers De-Bunk Retirements Myths"). Basketball and softball will replace
bocci ball and badminton, second careers and high-tech home offices will
replace the corporate grind, and, although Boomers will gravitate towards
vacation-like surroundings for new home communities, they will generally not
wander too far from grown children and the roots they finally put down as
they became part of the "establishment."
Answers to Sprawl
Builders and developers will not be able to satisfy "all of the people all of
the time," according to the article. Growth does not occur without
trade-offs. Suburban sprawl can be lessened with high-density housing, but
will there be a demand for homes such as these? And if everyone wants lower
taxes, how can they take the NIMBY (not-in-my-backyard) approach to low
income housing nearby, with a perceived eventuality of lowering their own
property values in the end?
BUILDER cites the traditional neighborhood developments (TNDs) as the mostly
likely model of neighborhood concepts to get permit approval stamps. These
may be described as transit-oriented, in-fill parcels and brownfield
developments. City planners love the concept, but many homebuyers may not be
impressed unless the formulas are correct, market-wise. The question for the
future is how to make this concept work best; too little density finds
builders spending high dollar amounts on preparing these unimproved areas for
the new and shiny without the necessary profits reaped to make it feasible.
Too high a density does not appeal to homebuyers who resist the
"apartment-like" feeling of smelling someone else"s cooking odors. And,
although buyers will pay well for shorter commutes, they must feel
comfortable as well, with planned open space giving them room to breathe,
walk dogs and play catch.
In newer suburban areas, demand for controlled or slowed growth continues to
spread as the public perceives the "rape of the land" having already taken
place in some areas. According to the article, "As metropolitan areas
expand, many first-ring suburbs now find themselves in the throes of
dis-investment, the same problem that afflicted cities in the "70s and "80s.
"First-ring" is loosely defined as some of the earliest suburbs built, during
a time when radio stations played songs depicting suburbia as "houses made of
ticky-tacky."
High Tech Homes
BUILDER asks the question, "Just how much are buyers will to spend on a
"smart" home?" Will they buy HDTV, ISDN lines, and "Total Recall" type
monitoring systems that "know" what type of music you like and keep an
electronic eye on the kids in the pool, while turning on the oven to prepare
dinner? New homes are even now being built with more computer power than
many businesses had in the "80s, with a "quiet revolution" in new home wiring
taking place. Structured wiring is now becoming standardized all over the
country, providing buyers high-speed Internet access, network capabilities
for home-based businesses and telecommuting, and distributed video systems
that can send entertainment to every room in the house with just one set of
components.
With structured wiring becoming the norm, true home automation may not be far
behind. Those of us that chuckled at film clips from the "60s predicting
push-button ease for home tasks, may soon be clearing our throats over the
"Big Brother is us" syndrome in the new millennium. The article cites rising
energy costs, air quality, electric utility deregulation, and a new
generation of Internet-ready appliances as catalysts for the home automation
boom-to-come. And, although it may occur in random, piecemeal fashion, we
may marvel at voice-recognition technology sooner than we think, imitating
scenes from Star Trek and "2001: A Space Odyssey", but wondering whose voice
it is answering us back.
In addition to these Mega-Trends, BUILDER studies subjects such as the labor
shortage in the trades, the quest for higher productivity through high-tech
advancements, resource efficiency, and the building sciences themselves,
sparking futuristic predictions and thought-provoking solutions to these
issues.
What we know for sure, however, is that the new century holds limitless
possibilities for the homebuilding industry. As sophistication levels rise
within the home-buying public, builders must position themselves to grant the
demands of these consumers. Their responses will no doubt confirm that
American innovation and the pioneering spirit that has made this country
great will continue to do so well into the new millennium.
Also See:
New Home Buyers are Getting Wired!
Engineers Ready to Build MIT"s "Home of the Future"
Exploring the Dark Side of the Digital Home
The Latest In Innovative Products For New Homes