Stop the presses: Home buyers say they intend to live within their means.
Furthermore, they say they’ve ditched the old dogma of buying the biggest home possible in order to maximize their gains when they sell it later.
Wait a minute. Are we still in America?
I ask this as one who chronicled every two-story-foyer, granite-countertopped moment of the housing boom, when time and again people would explain to me how not only were they stretching their finances in order to buy as much house as possible, but they were thrilled to do it.
But these days, apparently, we have a sobered buyer. American Lives, a market research firm in Carmel Valley, Calif., asked about 700 people who were kicking the tires at new-construction projects in May and June to share their attitudes about housing and the economy.
What they found represents a “fundamental attitudinal change,” according to Builder magazine, which collaborated on the research. The trade journal reported on the survey as part of its coverage of how builders should prepare for business after the bust.
“People want smaller homes, they want way more value for the money, and they want a house that is nearly a perfect lifestyle fit,” said Boyce Thompson, editorial director at Builder, who suspects that buyers now are going to be settling into their homes for the long haul.
“They realize the future appreciation in their investment is a big question mark, so they have to justify the purchase by saying, ‘This is going to be a great place to live my life and to raise my kids,'” he said.
“During the boom, people were buying McMansions because they figured if they got a 20 percent gain, 20 percent of a bigger number is a bigger gain,” Thompson said. “Now it’s the inverse — people are saying, ‘If I’m not going to get those gains, I’m going to limit my investment.'”
Bear in mind that the people interviewed for the survey were those who were optimistic enough about their own finances to go house shopping; the truly worried presumably stayed home. Nonetheless, two-thirds of the respondents say they’re at least somewhat concerned about keeping their jobs even as they contemplate homes to buy; this will translate into smaller, and less pricey, homes, according to American Lives.
About half said their main goal was just to own a home — the bells and whistles with it aren’t important.
The researchers also concluded that consumers are, indeed, buying into all the recent fuzzy-wuzzy media sentiment that it’s all about family and quality of life now and less about material gain. Toward that end, the buyers say the community that surrounds the house carries equal weight with the house itself, and those buyers said they’d settle for a smaller place to be in the right neighborhood.
On a side issue, the researchers reported that buyers’ environmental concerns are splitting into two shades of green. Yes, indeed, the buyers said, they’d agree to mortgage payments that were higher by $35 a month to cover $5,000 worth of energy-conserving features.
But bear in mind, consumers have a tighter grip on their wallets these days, and they’re less willing to spend money on things that won’t pay them back. For those home features that are merely kind to nature, the consumers said they’d pay only up to $2,000.
Gawking in Glencoe
If you’re planning to help Glencoe celebrate the season on Sunday, you can take in a bicycle race, devour barbecued cuisine — and tour 49 open houses.
Coldwell Banker Residential Brokerage has timed a community-wide open house event in concert with Glencoe’s annual Summerfest, which will wind up a three-day run Sunday.
The Glencoe homes are available for touring by price range: 11 a.m. to 12:30 p.m., homes priced $650,000 and below; 12:30 p.m. to 2:30 p.m., $650,000 to $1.1 million; 2:30 p.m. to 4:30 p.m., $1.1 million and up. Tour maps are available at 640 Vernon St. For information, call Mary Rosinski, 847-835-0236.
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59.4%
Respondents who somewhat or strongly agreed with “I am more concerned with getting a good investment than in buying my dream home” in a Builder magazine survey.
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Hear Mary Umberger at 12:49 and 11:15 p.m. Tuesday and Thursday and at 10:30 a.m. Saturday and Sunday on WGN-AM 720. Write to her at Money & Real Estate, Chicago Tribune, 435 N. Michigan Ave., 4th Floor, Chicago, IL 60611 or e-mail housingnews@comcast.net.
