Smaller, More Efficient Homes On The Horizon
I'm sitting here looking at the Dow futures, reading through this morning's news, & feeling reflective.
I remember responding to a thread here 18-20 months ago that my DH had attended a meeting where homebuilders from across the country spoke of shifting their design staff to smaller & much more efficient homes noting they were meeting with yacht builders for ideas on efficiency & storage solutions. Mostly, I was "poo poo'd" & accused of just being anti-McMansion. DH listened to what those builders were saying & began the process of adjusting the bank's strategic planning to reflect smaller loans.
As the housing boom has collapsed that meeting looks almost prophetic. When any boom busts...it's never led out by the same product that led to the collapse. A bust of any magnitude results in a sea change in people's attitude reflected in their desire for significant change. Combined with a rising 'green movement' (which I also predicted & was even more "poo poo'd" for) people are going to be clammering for smaller & more efficient housing.
McMansions are going to be white elephants for the foreseeable future, IMO. Sure, there will always be demand, at some level, for a large home. Telecommunting will keep a few properly designed large homes viable for a while; but, the days of people aspiring to & builders responding with subdivision after subdivision of gated, 4,000-6,000 s.f. homes filled with non-renewable resources are now a part of our history not our future.
My grandkids will be looking at purchasing their first homes in about ten years. IMO, as they drive around looking at choosing a neighborhood they'll point to the huge aging houses & mutter "Oh man, look at all these decaying homes. Some developer needs to come in here & condo these things into multi-family housing!"
Even as the market recovers these McMansions won't command the prices of 2004-2006. The next generation of home buyers will want a different product. They'll become the looming symbols of excess that charcterizes this financial collapse. It will take many decades for them to attain "vintage" appeal that some up & coming young couple will want to restore to its original condition in an affort to 'preserve heritage'. :(
I wonder what will happen to those dozen, or so, that sit empty & unsold in my area? Will they ever sell with those soaring ceilings that require heat, the kitchens that necessitate rollar skates to function efficiently, & endless slow to regenerate hardwood flooring? Or, will they continue to sit deteriorating in our harsh weather? There has been massive wealth destruction in the past couple months. I imagine even old New England money has been hit hard...I feel sorry for the elderly couple who's home we toured spring '07 with the incredible view of LIS. They'd already moved to their new, even larger home & felt this home would sell within days. It's still sitting there empty. We drove by a few weeks ago & the roof has lost some shingles from when H. Hanna blew thru in early September. It came on the market for $1.595M spring '07. It's now listed with the same agent at $1.395M. I predict it will sell for around $800K...and that only because of the view.
Some of these houses were built with enough quality they will withstand the passage of time & the changing consumer environment graciously & in many years become like the 1920s mansions. Sadly, those built with true jaw-dropping quality are few in number. Most are just semi-custom large boxes constructed without the true design, style, & level of workmanship to raise them to that level. Someday, our grandkids will be touring a few & gawking in wonder at the display of easy money characterizing this past decade in much the way we now tour Newport's Golden Age mansions. What? Maybe one in a thousand? What will become of the rest? It's going to take the passage of centuries for them to blend into the New England landscape full of large colonial homes. Many were built by people with adequate resources to afford the finished product & few McMansions went to subprime borrowers but...people are visual. So, for now, they have become the tangible poster child for the largest financial collapse since the Great Depression.
"The homes, while smaller, feature large open spaces, a so-called great room often linking the living room and dining room area that might have previously been walled off. The homes also have a two-car garage standard and storage space.
"The square footage isn't the focus, it's really the utility and efficiency and flexibility of the home that is our focus," Ruffner said. "You could have a three-bedroom, 2,500 square-foot single-story home and all you had was wide hallways and bigger rooms. It wasn't really giving (buyers) the utility."
Here is a link that might be useful: Builders Shift to Smaller Houses