What builders do to stay in tune with buyers

As millennials reach the maximum age to buy a home, new home builders are innovating and adjusting designs to meet the demand of these demographics. Single women, married couples, couples are all counted among the buyers, in an increasingly diverse mix that looks nothing like the nuclear family of the 1950s, which traditionally served as a model for new homes. Currently, the number of couples with two incomes and a college education is at an all-time high, with single women making up the second largest group buying new homes, according to a recent design summit held by John Burns Real Estate Consulting.

New home wish lists often include: space for a family with 30 percent of potential buyers desiring a guest suite comprised of a bedroom, a small living room, and a kitchenette. Millennials are strengthening their purchasing power in a price range, and Gen Z is waiting in the middle. And for 71 percent of families, the most important member of the household might be a pet.

More than just demographics has also changed. After a decade of HGTV and Pinterest, consumers are attuned to the architecture, design, and endless possibilities. “They have a stronger sense of ‘this is great’ … ‘This is interesting’… ‘This is a fancy style,'” says Jeni Lantz, Design Lens manager for John Burns Consulting.

As a result, builders are struggling to stay on the same page. “I think our industry is getting much more sophisticated because the consumer has all the answers. Home builders need to be smarter today,” says Mollie Carmichael, principal at Meyers Research. “They need to understand what consumers want and what they value.”

So what are builders doing these days to meet the wants and needs of homebuyers? Here’s what home builders are doing to stay current using research and data to drive designs:

The latest question: What do millennials want?

After the recession, what millennials wanted in a home was anyone’s guess. To address this question, Bassenian Lagoni Architects teamed up with TRI Pointe Group’s Pardee Homes Las Vegas and Builder Magazine to conduct thorough and in-depth research to inform the design of two concept homes geared explicitly for millennials. In addition to a wide-ranging nationwide survey of millennial homeowners and potential buyers, they also conducted a series of survey groups both on- and off-site to adjust plans and preferences.

Although the research was completed a couple of years ago, the ideas expressed continue to reflect consumers’ current desires and goals. For example, millennial shoppers often describe their goal as a “forever home,” one that can adapt to life’s changes. Concept homes were called Receptive Homes because they transform and adapt over time.
Such in-depth research, as well as the idea of designing a home for a specific demographic (aside from the over-55 age group), was equally groundbreaking at the time, though more builders turned to data and research during recovery.

Analyzing the data

“After the recession, people became wise,” Lantz says. One of the things is that architects and other companies are doing a better job of understanding buyers’ preferences, says Chris Texter, principal at KTGY Architecture + Planning. Firms such as John Burns Real Estate Consulting, Meyers Research and others conduct large-scale research initiatives on consumer attitudes, buying habits and preferences for households and communities.

In addition, Steve Burch, senior vice president at John Burns, says they can break down data from nearly 25,000 survey responses based on a number of variables, providing detailed information on preferences, including regional trends. Personalized studies allow for an even more focused view. In addition to home buyers, he says they also interview those who reject them.

Collaboration equals revolutionary results

“What happens when the builder is preparing to develop a community, they’ve already started the research and looked at the competition and market demands and read what John Burns is saying and then try to integrate the components into the houses that allow people to live and accommodate various stages of life.” explains Mary Cook, a principal at Mary Cook Associates, a Chicago-based design firm.

“Architects are creative by nature and creatives are naturally curious,” says Steven Dewan, NCARB, senior director at Bassenian Lagoni. While inspiration and ideas come from other industries and experiences including travel, he says, “Our preferred way of working to develop homes for new types of buyers is through designing charrette with our clients. The team of builders (management, sales, marketing, construction) along with our design team spend several days exploring floor plans that fill a gap in the market or serve existing buyers in entirely new ways. Getting ideas and suggestions from the whole team generates truly revolutionary results that work well in the marketplace.”

Sentiment-based adjustment

Adjusting homes and developments to the current needs of buyers is not limited to the planning process. “Builders are also getting informed of what’s happening in their sales office,” says Cook. “Sales people not only report on the amount of traffic, but they can also say, ‘If we only had this, they could have brought it.’ We’ve had situations where builders call us saying, for example, ‘We’re having single parents and they’re looking…’ And then we redesigned the house.”

Regional developers have another perspective. By focusing on the Chicago area, Jeff Benach, co-director of Lexington Homes, believes he gains a deep understanding of what that market demands, as well as land availability and the convenience of specific locations. “The nationals are quite left with the same patterns. We have a little more agility about it. We don’t have to climb things up a mast. If I think something needs to change, I can just pull the trigger.”

Most of Lexington’s new communities are closer to the city, in areas easily considered surban. Flexibility is an integral part of many of these plans. Some models include flexible space; Others offer flexible space in addition to an office on the first floor. Others have even wider options for setting up the second floor, so a second master bedroom or a large upper room can be incorporated. More domestic builders are also incorporating flexibility into their designs. JBRC’s Design Summit featured an innovative plan from Shea Homes that gives consumers options to configure large living-kitchen-outdoor living rooms, based on their lifestyle.

While more media reports suggest a possible weakening of demand, Lantz says more builders are turning to research.

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By Catharine Bwana