NEW YORK (MainStreet) – While housing, and homebuilding in particular, have taken a massive hit due to the Great Recession, many housing experts do not expect this trend to continue long term as more unemployed Americans get back to work, empty-nesters begin to downsize or build their dream homes, and 'boomerang kids' who were “doubling-up,” or living with their extended family, decide to move out of Mom and Dad’s basement and strike out on their own.
According to the National Association of Home Builders, this “pent-up demand” for new homes is expected to increase only slightly in the coming months, but the new homes to enter the market will be tailor-made to fit Americans’ changing needs and desires in the post-recession years.
“What’s driving it all is affordability,” says John McIlwain, senior fellow for housing at the Urban Land Institute in Washington, D.C., who notes that high unemployment, credit and student loan debt, stricter mortgage rules and a surplus of foreclosed homes will likely continue to scare many first-time buyers from the housing market and keep new home construction relatively slow.
The McMansion home of pre-recession years is on the way out, but a quality home with “well-designed bones” that is relatively inexpensive to operate has become more desirable, says McIlwain.
MainStreet talked to homebuilding experts to learn more about some of the key features home shoppers can expect to find in the new American home this year. Read on to learn all about the modern-day dream home and what not to expect on your house-hunting adventures.
Utility & Value
Homebuilders will continue to scale back on luxury add-ons, which are becoming more of an afterthought, says McIlwain, as homebuyers opt for a more modest and functional home, rather than a McMansion with a Jacuzzi and a heated pool.
“People are looking for shelter and value,” says Stephen Mellman, director of economic services for the National Association of Home Builders in Washington, D.C. “Everyone has their own lifestyle and they want to find a home to enhance their lifestyle and make it more efficient.”
Also with affordability still a huge factor for homebuyers, buying a new home no longer entails “doing fancy things” just for the sake of making a boom era statement, nor does it mean sinking the greater chunk of your cash into a long-term investment, as “the likelihood that that house value will appreciate is extraordinarily remote,” notes McIlwain.
The most noteworthy trend this year is that homebuyers are beginning to see their home as an extension of their lifestyle, whether that means making a strategic move from the suburbs for a shorter commute, having more proximity to downtown hotspots or finding a way to downsize after the children have flown the coop.
“This is shelter,” Mellman agrees, “it isn’t just an investment to sell in a year; you’re going to live here and raise your kids here and that colors everything: how you design it and what you’ll enjoy."