Picture a newly built house rising out of the earth, bare around the edges except for the obligatory row of shrubs marching across the foundation. Then imagine the same house, framed by a sweep of trees and finished off with a tasteful pathway that compliments the lines and materials on the house. It's pretty obvious which look is more compelling for the average buyer.
But can builders profit from offering landscaping services, and does a standard package help to sell the house? It depends, of course, on who's buying. What is clear, though, is that consumers are paying good money to make the outside of their homes look better. A study by the National Gardening Association, in Burlington, Vt., found that spending on landscape installation and construction more than tripled in the past five years, from $3.6 billion in 1997 to $11.2 billion in 2002. Putting the numbers in perspective, Bruce Butterfield, NGA research director, says the amount homeowners spend on their lawns and gardens has grown at a steady pace: "Eight percent each year for the past five years, better than what the economy is doing," he notes.
What's less predictable is how much value buyers place on a pergola or flagstone path at the time of sale. Landscaping, or the lack of it, isn't usually a deal-breaker. And paying for big-ticket items such as patios, paths, and shade structures becomes more palatable a few years down the road. That's also when homeowners have a better idea how they want to use their outdoor space. Still, builders in all price ranges are testing the market.
The Green Scene
In recent weeks, Village Homes, in Littleton, Colo., has started offering outdoor amenities such as fireplaces, fire pits, and built-in grills. Ed Lowell, vice president of sales and operations, says the options, which range in price from about $1,200 to $4,300, are an attempt to stay on the cutting edge. "We've seen these items at trade shows and are seeing what we can do to offer something that's different," says Lowell. But the builder has no plans to finish off its detached homes with greenery. "Frankly, we sell the fact that when people put in their own landscaping, it's much more individualized," Lowell says. "Communities come alive when they install their own, as opposed to a builder package."
"When we leave a community, we want to be proud of it, and landscaping is such an important part of that overall look," says Larissa Abeling, vice president of sales and marketing. O'Brien's upgrades package includes hardscape items such as tiled porches, slate or flagstone walkways, and matching bands on driveways -- options that 75 percent of its upper-end buyers choose. "We try to stay away from any back yard landscaping upgrades," she adds, "as people have their own ideas of what they want to do."
Other builders have found that certain types of homes become more attractive when buyers are shown possibilities for enhancing what's outside the drip line. In Dallas, Mercedes Homes offers a choice of landscaped courtyards for the side yards of products with zero lot lines. The homes, considered first-time move-up, sell for $170,000 to $215,000. Kevin Procaccino, vice president of product development, says there are two packages -- one consisting entirely of vegetation, the other including a patio, fireplace, or small water feature. Thirty percent of those who buy the homes choose a landscape package, he says, spending from $1,500 to more than $5,000. And for the front of these homes, at least half of Mercedes' buyers purchase a generic planting scheme that can be upgraded with the landscape company after closing.
Higher-end buyers are more likely to seek custom, turnkey service and the ability to roll the outdoor kitchen and lap pool into the mortgage payment. And when the stakes are high, builders may need to be more active in explaining the value of a sophisticated master plan.
Laing Luxury, a division of John Laing Homes, in Newport Beach, Calif., expects to profit from such consumer spending in its communities at Crystal Cove, where 30 homes, ranging from $1.4 million to $3 million, have been sold to date. The builder operates a custom design/build program that "sets us apart from other builders in the same price range," says Joan Marcus-Colvin, vice president of the design studio. Laing Luxury partners with several design/build firms to work with clients, and in-house landscape manager Jim Henderson shepherds the team through design, budgeting, architectural review board approvals, and construction.
Marcus-Colvin says one client spent $200,000 to design the grounds of his $2 million home -- easy enough to do on master plans that can include outdoor cooking facilities, arbors that match the house's architecture, and water features such as fountains, spas, and lotus ponds. "We're running right around 50 percent on buyers who've opted for a custom plan," she says.