They don’t call them “model” homes for nothing-model, as in perfectly appointed, fully featured, exquisitely outfitted. If the home builder’s marketing and interior design people have done their jobs, a model home should be to sigh for.
But wait: Take a peek in the powder room. See that hand-painted Italian sink whose faucetry curves more delicately than a swan’s neck? It’s an option. (The sink that’s included in the standard offering is an unadorned white bowl on a porcelain column. Nothing wrong with it-it’s just more, uh, basic than the one you’ve already decided is the Holy Grail of powder room sinks. You can have the Italian number, but it will cost you a little something extra.)
And if you’re really budget-driven, don’t become too enamored of that Mexican tile floor in the breakfast room-it’s an option too. (The basic home has good old no-wax vinyl flooring that gets more points for practicality than for style.)
And maybe it would be better if you averted your eyes from that killer cathedral ceiling in the master bedroom. We’re talking dollars here.
But if you’ve made up your mind that your dream home means “upgrading” to include the sink, the tile, the cathedral ceiling and other goodies that you hadn’t even thought of until the models made you want them, be prepared to upgrade your budget, too, perhaps by many thousands of dollars.
This isn’t bait-and-switch marketing, builders say. Rather, the fully equipped, designer’s dream models are a way of revealing to buyers the art of the possible. Don’t forget, “potential” is one of the most often-heard terms in any real estate scenario.
And this is not to say that every builder in every price range considers every little item to be an option. Far from it: In a competitive market, some builders may throw in the kitchen sink, as it were. Often, what is “standard” depends on two things: what the builders presume their target clients will demand, and what one builder thinks the builder down the road is offering.
Either way, you’re always going to pay for it. The difference often is a matter of where on the bill the item shows up: If it’s standard, it’s part of the base price. If it’s an option, it’s added on.
The amount and extent of the options depends on several factors, including price range, competition and buyers’ preferences. Builders say that adding options is a way to give buyers a preview of how their dream home could look. It also is a way of providing variety and avoiding the “cookie-cutter” epithet.
And by showing a variety of options in each price range, builders hope to appeal to a wide range of buyers. To add the options into the price of the home would make houses too expensive for most buyers, builders say. Besides, not all buyers would want the wood-burning fireplace and the three-car garage, area builders note.
Some features are optional because they reflect differences in lifestyles and are not items that every buyer would choose. A buyer with a large family, for example, might want to add several feet to a family room. Another buyer might prefer to add a breakfast room. Those types of changes force the builder to change the standard floor plan. They are thus priced as options.
Builders use several methods to decide what becomes an option. They conduct market studies and focus groups to gauge home buyers’ tastes and attitudes toward various features. They also try to keep track of lifestyle changes that would affect options in a home.
The Baxter Group, for example, changed its pricing at Country Lane at Wadsworth Lake to include basements. Houses here are base-priced at $154,900 to $229,900. During the early sales period, basements were options, priced from $10,500 to $14,900.
Under the current price structure, buyers who do not want basements receive a $10,000 credit toward other options, said Andrew Warner, director of sales and marketing. The change in basement pricing was a result of looking at the targeted buyers (families with children) and realizing that those buyers need basements for storage, Warner said.
At Fairways at Rivershire, the opposite is true, he said. The Lincolnshire development of single-family homes, priced from $349,500 to $429,500, is popular with empty nesters. They don’t want basements, Warner said. One reason they are moving is to get rid of all of that junk at the foot of the stairs.
Sometimes it’s just timing: Builders might include certain features-fireplaces, for example-in the so-called preconstruction pricing, before models are constructed and when it can be difficult to get customers to put faith in blueprints and builders’ promises. Or basements might be included as standard when a development is nearing closeout and the builder wants to sell the last lots.
Price range is another factor. As buyers climb the price ladder, they should expect certain features to be included. By contrast, buyers in the lower brackets shouldn’t expect such luxury features as whirlpool tubs without paying extra. In fact, in many entry-level communities, refrigerators routinely are not included among kitchen appliances supplied by the builders.
With first- or second-time-buyer homes, you’ll find more options that are basics, said Bill Gronow, president of Kennedy Group Limited Partnership. Air conditioning, fireplaces and basements are typical options, he said. Including these items in the standard cost would make the house too expensive for many buyers, he said.
On the other hand, at the company’s Arbor Hills development in Algonquin, where single-family homes are base-priced from $217,000 to $273,900, three-car garages, basements, fireplaces, air conditioning and other features are included; these would be options in lower price categories, Gronow said.
In this development the main options are changes dictated by site conditions, such as walk-out basements or screened-in porches, he said. Those items require structural changes and thus carry an additional cost.
As buyers move into a higher price category, they will find that fewer items are considered options. In a $180,000 home the expectations shouldn’t be the same as in a $300,000 home. Fireplaces, for example, are included in the price at The Fairways at Rivershire, but are $3,900 options at Country Lane. In the higher-priced homes, people expect those types of features to be included, Warner said.
Beyond the $300,000 mark, homes typically will include more expensive floor, carpet and countertop materials, Warner said. You may upgrade to a designer color, but you’re less likely to change the standard material.
Also, not all buyers want the same features. A whirlpool tub, for example, is $1,600 in most Kennedy developments. As many as half of Kennedy’s buyers don’t really want such systems, Warner said.
Hardwood floors usually are sold as options, regardless of the price range, Warner said. Most new homes include carpeting as standard in the living and dining rooms and the bedrooms. Hardwood is more costly and many buyers prefer the look of carpeting, he said. To include it might be a waste of money because they’ll just put carpeting over it, Warner said.
Regardless of the price range, most home buyers do add some options. In the moderately priced product range, people will spend $5,000 to $15,000 on them, Gronow said. In Arbor Hills, the average is $15,000 to $20,000, but it is more in structural changes than decorator items.
So, how do you know what’s included?
Obviously, you have to ask, point-blank. Builders usually display lists of optional items in models or will provide them upon request.
Few include the prices unless you ask. This is generally because these costs may vary by the size of the house or the type of carpeting chosen, though prospective buyers should reasonably expect sales staff to be able to ballpark the costs of some upgrades.
If you’re still smitten with that model home, another way to get all the optional goodies without wading through the cost tradeoffs and potentially overwhelming selection process is to be patient and buy the model itself. Sometimes-not always-builders who are eager to close out a development will be willing to strike a deal on some of the features in the models. That powder room of your dreams could be within your grasp after all.
