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Grass or Money, It's All About Green

September 21, 1997|LEW SICHELMAN | SPECIAL TO THE TIMES

WASHINGTON — If new research from California on buyer preferences is on target, home builders everywhere need to place more emphasis on recognizable brand-name materials.

And builders, especially those in urbanized areas where land is at a premium, should pay more attention to the size of backyards, which is what 40% of some 2,500 "serious shoppers" told researchers this spring as they left 101 projects in Southern and Northern California. There is a trend against tiny backyards.

The would-be buyers also indicated that their big-screen television sets and home entertainment centers are more important to them than fireplaces. And those who work at home said they want some flexible space near the front door where they can meet clients.

Ordinarily, findings in a single geographic region--even one the size of California--aren't terribly germane to the rest of the nation. But California is the place from which many of the country's design trends emanate, so what builders do there is often emulated elsewhere.

Furthermore, researchers Robert Mirman of National Survey Systems and John Schleimer of Market Perspectives say that although there may be some regional differences, their "Vision '97" study can be "generalized" for every major market.

If Mirman and Schleimer are right, builders throughout the country face some difficult challenges, because these buyers say they want all of these things--and more--but they aren't willing to pay for them.

The test that builders face with regard to building materials, for example, is how to include better-grade sinks, appliances, windows, doors, flooring and other components without driving up the price of their houses beyond acceptable levels.

One way to do that, of course, is to offer a greater number of options so that buyers can see exactly how much higher quality actually costs. Another is to find ways to trim so-called "hard" construction costs.

"If they can save, say, 10% on their hard costs by doing away with repetitive wiring, plumbing and ducts; by cutting out redundant processes and shortening the time it takes to build a house; or by switching to modular components, builders can give buyers better features and appointments without busting their pocketbooks," Schleimer said.

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Whatever avenue builders take, they'd better do something, because the buyers interviewed said they expect to reside in their next new homes for an average of 13.5 years.

"When buyers start feeling that way, they want something that's going to last as long as they are," says the Roseville, Calif.-based consultant. "Today's buyers don't want to be faced with major repairs or replacements down the road."

The point here is that housing is no longer a short-term purchase. "It used to be that if you asked people how long they intended to stay, they'd look at their watches," says Mirman, who is based in Irvine. Not anymore. While the average was 13.5 years, the largest percentage of shoppers surveyed said they planned to remain more than 15 years.

An aberration applicable purely to California? Hardly. Research by the Chicago Title Insurance Co. shows that folks throughout the country hold their homes longer than most people realize. In fact, over the last 25 years, the average home changed hands only once every 12.5 years.

Another indication that buyers (especially those who have owned other new homes) want higher quality is that nearly one out of four buyers queried by the "Vision '97" researchers said that one of the things they dislike most about they way houses are built nowadays is the lack of top-grade materials.

Even a greater number--two out of five--found the backyards too small. In fact, the feature they liked least of all was small backyards. In other words, buyers are rebelling against small lot developments designed to hold down costs.

"They were repeatedly disappointed in the backyards they were seeing," Schleimer said. "The largest percentage of shoppers reported their favorite part of the house they grew up in was the backyard. But there is just no room back there nowadays. The houses eat up so much of the lot that the backyard is almost nonfunctional."

Of course, one way to give buyers bigger yards is to build smaller houses. But buyers want more space, not less, secondary bedrooms that are too small are the third most-disliked feature, according to the "Vision '97" survey.

So the only real choice is to develop larger lots. But won't that drive up costs, particularly in markets where land availability and price are issues?

Not necessarily, Schleimer said. "Just an extra 10 feet will have a tremendous impact on how buyers perceive their yards. That will result in fewer lots, but the trade-off will be faster sales and increased market share. Builders may even be able to obtain a premium for lots with bigger yards."

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