Housing Market Stabilizing with Energy Efficiency and Outdoor Spaces Still Popular

Source: CUSTOM HOME Magazine

The American Institute of Architects' (AIA) 2011 second quarter Home Design Trends survey shows stability in the residential market, but not the recovery predicted after an encouraging first quarter. High-end and custom homes are still faring best among new construction projects, while first-time home buyers remain timid. What has changed in the luxury and high-end sector is that specialty rooms and additions, as well as high-end features within a home, are mostly declining. The exception to that trend is a strong rise in home offices and an equally impressive number of requests for outdoor living. Remodeling and additions, a persistently strong segment of the residential market, continues to show moderate gains thanks to clients looking for accessible spaces, energy efficiency, and home technology upgrades.

Approximately 500 residential architecture firms across the country responded to the survey and reported on their local market trends, billings, and backlogs. The AIA's chief economist, Kermit Baker, analyzes their responses and details the findings in the full report. Baker comments that because housing prices haven't stabilized in many markets, homeowners remain hesitant to invest in specialty rooms such as hobby areas, home theaters, playrooms, guest suites, and exercise rooms. Custom features like pet stations, central audio systems, automated lighting, and built-in safes also demonstrate less interest from homeowners. However, because telecommuting and "staycations" remain popular, there are areas where residential architects and custom builders can benefit.

"Demand for home offices for telecommuting remains strong," says Baker, adding that "trends toward informal lifestyles, as well as more home-centered activities, have helped maintain interest in outdoor living areas and mudrooms." Other requests still on the rise focus on accessibility and energy efficiency. Backing up those trends, the most requested products include those promoting energy-savings and management, as well as wireless communication systems. Seventy percent of respondents saw requests for simple green upgrades such as alternative or additional insulation grow over the past three months. With regard to accessibility, the most desired items include first-floor master suites, open showers with no floor level changes, ADA-compliant faucets and door handles, and ramps or elevators.

For future market predictions, Baker looks to residential firms' billings, which are mostly stable across the country. The residential firm billings index for the second quarter was 50, which indicates neither growth nor decline. Backlogs also represent stability having maintained a fairly high average of 3.2 months. Many new construction billings fell during the second quarter, however. Respondents listed second and vacation homes, townhouses, and condos all as declining. And although the high-end residential sectors are at least maintaining their numbers, Baker believes that until the new houses aimed at first-time or trade-up buyers improves, those custom homes will be at risk.

URL to original article: http://www.customhomeonline.com/industry-news.asp?sectionID=204&articleID=1661709&cid=BP:091611:FULL

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