Information was as abundant as optimism this week at the International Builders’ Show in Las Vegas, where more than 75,000 home builders and suppliers gathered to discuss topics ranging from new building products to buyers’ preferences.
Many economists predict that 2014 will build upon the home-market gains from last year, bringing big increases in the number of homes built and of new homes sold. That bullish outlook contributed to rising attendance at the conference and a resurgence of exhibitors offering luxury and discretionary items.
Meanwhile, builders boned up on strategies to keep the momentum going, such as learning that buyers covet low-emissive windows and don’t much care for outdoor kitchens. Here’s a look at a few pearls offered up at this week’s conference.
1) Walk-In Closets In, Laminate Countertops Out: Buyers this year really like big closets attached to their master bedrooms. Outdoor fireplaces? Not so much.
The conference’s organizer, the National Association of Home Builders, outlined the results of its December survey of buyers’ preferences. The top new-home characteristics most favored by respondents, in order: walk-in closets, “low-e” heat-reflecting windows, laundry rooms, great rooms, energy-star related appliances and programmable thermostats.
Getting the most thumbs-down votes from respondents: laminate countertops, outdoor kitchens, outdoor fireplaces, sunrooms and two-story family rooms.
2) New Homes Are Still Growing: Americans, when they can afford it, nearly always opt for a larger house. Consider that the average size of a newly built home in the U.S. has increased for five consecutive years to 2,679 square feet.
Census data shows that, last year, 48% of newly built U.S. homes had four or more bedrooms, according to a builders’ association presentation at the show. That’s up from 34% in 2009. New homes with three or more bathrooms increased to 35% last year, up from 23% in 2010. Those with three-car garages increased to 22% last year from 16% in 2010. And two-story homes rose to 60% of all construction starts last year from 51% in 2009.
3) Boomers Not Done Yet: The Baby Boomers aren’t ceding the home market to Generations Y and Z yet.
Jonathan Smoke, chief economist at research firm Hanley Wood LLC, pointed out at the conference that buyers aged 55 years and older are forecast to account for 25% of the home-buying market this year. That ratio is likely to grow in the coming years, he added.
Video: Jonathan Smoke talks about demographic influences on the home market at #IBSvegas.
Boomers already account for 27% of the U.S. population, and that is expected to increase to 29% by 2019, Mr. Smoke said. They’ve owned homes for many years, and they have the financial wherewithal to improve them. To wit, Boomers account for 40% of remodeling activity.
“They’re the ones who are tired of their current house and are ready to make a change,” Mr. Smoke said. “And they have the money to do it.”
Generations Y and Z, who are younger than 34, will be harder to predict when they begin buying homes in force. They’re not as affluent as their parents, and they have hefty student debt. What’s more, Hanley Wood finds that the younger generations are 14% less likely than older folks to prefer buying a newly built home.
via:http://blogs.wsj.com/developments/2014/02/07/three-takeaways-from-the-international-builders-show/?mod=WSJ_Real+Estate_BLOGSDEVELOPMENTSFEED&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+wsj%2Fdevelopments%2Ffeed+%28WSJ.com%3A+Developments+Blog%29
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