INSIDE REAL ESTATE: Breaking down myths about what homebuyers want
If homebuilders are wondering what type of housing they should build in 2017 and beyond, all they have to do is read the recently published book by the National Association of Home Builders. The 124 pages with 156 pages of addendums is a blueprint of home buyers’ wants and needs in all age groups and income categories.
So let’s get started with breaking some myths. Despite planners’ and developers’ love of higher density, single-family homes remain the preferred choice for buyers of all incomes. Nearly 70 percent of moderate-income buyers like suburban communities.
At least 70 percent of high-income buyers also like suburbs that are near trails, parks and retail space. In Anchorage that destination is southeast and southwest areas for new homes.
Higher-income buyers prefer new over existing homes. They understand and are more readily able to pay the higher price per square foot for new so that they don’t have maintenance and repair expenses in the future.
This is particularly true of the baby boomers who are reaching retirement age and looking for their final “destination” home. More moderate and lower income buyers are still seeking more square footage at a lower price.
Here’s another myth: Lot size is not an issue for more than 20 percent of buyers, irrespective of income. That’s good news for Anchorage where single-family lot sizes are getting smaller and smaller due to high development costs.
Whether it creates an attractive streetscape or not, larger homes on smaller lots are here to stay. Unless, of course, you can afford to move up to the hillside. Otherwise, developers need to work harder to control architectural details on the front elevation of homes and landscaping to make a cohesive and attractive small lot community.
Moderate-income buyers do not care about the popular two-story elements seen in many new Alaskan homes. They’d prefer more square footage. As an alternative to the two-story great room or entry hall, buyers want 9-foot ceilings, even on the second floor.
The powder room no longer exists in most new homes. Instead, it is replaced with a full bath on the main level. This is a preferred choice for both moderate- and high-income earners.
Everyone talks about technology in the home. We have programmable refrigerators, fans, etc. But what are buyers willing to pay for?
Moderate-income buyers want a wireless security system and a programmable thermostat like “Nest.” Technology pretty much stops there unless you are a high-end buyer.
Finally, the dilemma faced by all homebuilders is size versus amenities. So, here is the answer: Most buyers prefer high quality amenities such as solid surface countertops. If new means smaller square footage, it needs to be accompanied by luxury finishes. Smart builders understand the differences between new and old and build accordingly.