Home-Buyer’s Priorities Are Changing

Research done by the National Association of Home Builders and Better Homes & Gardens magazine reveals that, at least with regard to their houses, American consumers are starting to think smaller.


According to Gayle Butler, editor-in-chief of Better Homes & Gardens magazine, home buyers, either by necessity or choice, are ready to take a step back from the McMansions or trophy homes.

Buyers in 2009 want to live in a home that is cozier, more organized, and more economical in terms of operating costs. They want “Wii-sized” and media-centric family gathering rooms with enough floor space for playing the popular and physically interactive video games. They also want more storage to keep clutter under control in these smaller homes. This could include anything from built-in shelving to a pantry that allows families to save money on groceries by stocking up on food staples.

Today’s buyers want homes that are more economical to operate. Ninety-one percent of respondents to a Better Homes & Gardens online survey of readers anticipating a move to a new home said they wanted an energy-efficient heating and air-conditioning system in their next home. An NAHB survey received similar results, with 91 percent of respondents preferring an energy-efficient home with lower utility bills versus a cheaper home (with a sales price 2% to 3% lower) without energy-efficient features.

Americans also appear to be willing to spend money to live in a greener home. According to NAHB’s research, home buyers said they would pay an average of $6,000 more for their new home to save $1,000 annually on energy costs. More and more consumer realize it’s in their long-term interests to invest in energy-efficiency features. Federal tax incentives for homeowners who upgrade their homes to be more energy-efficient might also be having an impact.

According to both the NAHB’s and Better Homes & Gardens’ research, other things that are growing in importance to today’s home buyers include outdoor features (65% of buyers said they wanted a front porch) and a home office (71% of all buyers said a home office was “desirable” or “essential)

Do you agree or disagree? I and other Builders would like to know what you think.

Chuck Miller GMB CGB MIRM CMP MCSP CSP
President / Builder – Chuck Miller Construction Inc.
(208) 229-2553
www.chuckmillerconstruction.com

If Only

This is a sequel to my last blog, E + R = O. For those of you who have read Napoleon Hill’s “Think & Grow Rich”, this will probably sound familiar. For those of you who haven’t, I highly recommend that you add it to your reading list. “Think &Grow Rich” has been described as one of the most influential books of all time in pointing the way to personal achievement. I believe the principles in this book are especially applicable now when we are in the worst recession since the Great Depression.

In the closing pages of his book, Mr. Hill asserts that people who do not succeed have one distinguishing trait in common – they know all the reasons for failure and have built what they believe to be air-tight alibis to explain their personal failures. These alibis allow us to shift the blame for any negative outcomes we experience to events and circumstances and away from our response to those events and circumstances. Alibis are easy to recognize. They typically begin with the words – “If only.”

As professionals who earn our livings from the housing industry – and I include Builders, Developers, Realtors, Lenders, Trade Contractors, and Material Suppliers – are we building alibis for difficulties we are currently facing? Do any of these sound familiar?

If only the media would stop reporting all the negative news about the economy,

If only consumers would just stop listening to all the negative news and start spending again,

If only all those people facing foreclosure wouldn’t have bought homes they couldn’t afford,

If only the mortgage companies had not written all those no-doc and low doc loans,

If only Wall Street had not created all those collateralized debt obligations and other asset-backed security and structured credit products backed by those questionable mortgages,

If only the banks would just start lending money again,

If only the government would hurry up and enact an economic stimulus package.

What other alibis have we built?

I believe what Napoleon Hill wrote over 80 years ago is still true today - building alibis with which to explain away failure is a deeply rooted habit. But if we want to succeed, it is a habit we need to break. We need to stop blaming events and start working on how we are going to respond to those events in order to produce our desired outcomes.

Our greatest asset is our minds. Let’s put our minds to work to formulate responses to the current crisis in the housing industry. Better yet, let’s create Master Mind groups to formulate those responses. For, as the saying goes, two minds are better than one.

Chuck Miller _{GMB CGB CGP MIRM CMP MCSP CSP}

President / Builder – Chuck Miller Construction Inc.

(208) 229-2553

chuck@chuckmillerconstruction.com

E + R = O

For those of you who have read Jack Canfield’s Success Principles, you are familiar with the formula E+ R = O. For those of you who are not, the formula is E (Events) + R (Response) = O (Outcome). The formula expresses the idea that our response to every event we experience in our lives determines the outcome. If we don’t like the outcomes we are currently experiencing, we can either blame the event (E) for the outcome (O) or we can change our response (R) to the event (E) until we get our desired outcome (O).

I heard Jack explain the formula again as I was listening to my Jack Canfield’s Success Principles CD’s this morning on my way to the gym this morning, and I thought about how applicable this formula is to the current state of affairs in the housing industry.

Let’s think about how this formula is currently being applied. As professionals who earn our livings from the housing industry – and I include Builders, Developers, Realtors, Lenders, Trade Contractors, and Material Suppliers – how are we responding to the current events?

Are you blaming the Wall Street, the banking industry, the mortgage industry, the government, etc., etc., etc.?

Are you “hunkered down” – stubbornly holding on to your old ways of doing business or simply hiding out and trying to hold on until things finally turn around - hoping that the government will act quickly to pass its much debated stimulus plan and that the stimulus plan will turn things around?

Or are you responding by taking positive action? Here are just a few thoughts.

Have you read the legislative alerts from NAHB regarding the stimulus package currently being debated and contacted your Representatives and Senators to voice your opinion?

Have you researched what mortgage programs are currently available to your potential buyers so you can share that information and help alleviate their fears that are preventing them from moving forward?

Have you considered forming strategic partnerships with other industry professionals to promote your product and services? If you’re a Builder, have you spoken with Developers, Realtors, Lenders, Trade Contractors, and Material suppliers to see if you can develop strategies to help you reduce your costs?

Have you done your market research? In most markets, homes are still being purchased? Who is buying? What are they buying? Where are they buying?

Have you adjusted your product offering based on your market research?

Have you diversified?

Have you talked with your Realtor and Lender partners about conducting educational programs for potential home buyers to try and allay their fears and provide them with the information they need to feel comfortable about buying?

If you haven’ responded by taking positive action, hopefully this will spur you to act. If you have and it hasn’t resulted in your desired outcome, what else could you try? If your response has resulted in the desired outcome, how about sharing what your response with the rest of us.

Chuck Miller GMB CGB CGP MIRM CMP MCSP CSP
President / Builder – Chuck Miller Construction Inc.
(208) 229-2553
chuck@chuckmillerconstruction.com