David Crowe

Chief Economist 

NAHB

Washington, D.C.

dcrowe@nahb.com
Anje Jager/agencyrush.com David Crowe Chief Economist NAHB Washington, D.C. dcrowe@nahb.com

New homes change with consumer preferences, product developments, and technological changes. Builders attempt to anticipate broad consumer tastes, and every year the NAHB asks members what they are planning for the next year. What results is a limited list of features across a broad range of builders that, while not likely to define every new home, can show relative ranking across four dozen possibilities and trends over time.

The latest data reveal that recently built homes are larger and contain more bedrooms and bathrooms than ever before. As of the third quarter of 2015, new single-family homes had a median size of 2,485 square feet, the largest in the 40 years of records. In comparison, the stock of all owner-occupied homes in 2013 had a median square footage of 1,800. The expansion is a consequence of fewer first-time home buyers and more buyers with sterling credit sufficient to pass the tighter underwriting standards. As a result, builders are planning slightly more elaborate homes for 2016.

Two themes dominate what builders are most likely to include this year: storage and energy conservation. Builders reported a high likelihood for including a walk-in closet in the master bedroom, a separate laundry room, a kitchen island, a two-car garage, and linen closets in the non-master bathrooms. A few other space-eating items rated moderately high on the list, including a separate toilet compartment, space for kitchen dining, and a walk-in pantry. Builders rated a great room very close to the top, but were lukewarm on a separate home office and a living room. Media rooms and sunrooms were rated low by most respondents.

Builders continue to put energy conservation items high on their list. Low-E windows were at the top, followed closely by Energy Star–rated appliances and windows and a programmable thermostat. Insulation greater than required by code and a multi-zone HVAC system were rated moderately high. A whole-house Energy Star rating ranked lukewarm; other energy and environmental rating systems were not included on the list.

The questionnaire did allow for a few trade-offs to judge preferences between alternatives. Hardwood floors are preferred over carpet on the first floor; cork floors ranked last. In the kitchen, granite countertops are preferred over laminate. A shower stall and separate tub held a moderate preference level, but whirlpool baths were near the bottom. A front porch was rated higher than a patio, which was rated higher than a deck.

Even with the desire for larger homes, there were some more elaborate features that still ranked low, such as two-story foyers and family rooms. Outdoor features were rated low, including a fireplace, kitchen, and walking or jogging trails in the community.

The relative ranking in preferences has not changed significantly over the past five years, but a few items have increased in importance. Kitchen features had the greatest growth in likelihood ratings, including almost a full point rise for granite countertops (on a scale of one to five) along with an increase for a walk-in pantry and central island. Other highly rated items that rose significantly include a front porch, a two-car garage, and 9-foot ceilings on the first floor. Although in middle of the pack, a mudroom and multiple showerheads in the master bath did increase from low ratings in 2010. While rated relatively high in the most recent survey, linen closets in secondary baths and having both a shower stall and a tub in the master fell in preference.

There was also some variation in how likely builders are to include certain features in their average homes this year based on the volume of building, which is likely to indicate speculative versus custom builders. Larger builders are more likely to install granite countertops, a programmable thermostat, a walk-in pantry, and a front porch. Larger builders are less likely to install hardwood on the first floor, Energy Star–rated windows, and a living room.

A more extensive list of preferences rated by consumers is available from the NAHB’s bookstore.