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What Do Buyers Want in a Home?

Written by Ilyce Glink on July 17, 2012 in Real Estate  |   4 comments

Ups and downs continue to dominate the housing market. According to recent data from the United States Census Bureau, the average sales price of new single-family homes sold in 2011 was $267,900—a significant decrease from average prices of $272,900 in 2010, $270,900 in 2009, and $292,600…

homebuyers housing marketUps and downs continue to dominate the housing market. According to recent data from the United States Census Bureau, the average sales price of new single-family homes sold in 2011 was $267,900—a significant decrease from average prices of $272,900 in 2010, $270,900 in 2009, and $292,600 in 2008. Yet even though many people are pinching pennies and looking for more ways to save, the economic downturn has not stopped prospective homebuyers from wanting a larger home equipped with many storage areas and name-brand appliances.

On the Census Bureau’s recently released 2011 Characteristics of New Housing webpage, the nationwide data for new, privately owned residential structures shows that while home prices have gone down, what has gone up in recent years is a home’s average floor area.

“In 2011, the average floor area of homes completed increased 3.7 percent from the previous year,” said Stephen Melman, director of economic services at the National Association of Home Builders.

Census data for 2010 showed the average floor area of a home completed was 2,392 square feet, and last year it was 2,480 square feet. The rise in floor area measurements is not a significant bump, but it is a notable one. Melman said he was surprised to see the increase, remarking that he would have thought that the economic decline would compel buyers to purchase smaller, lower-priced models.

Homebuyers getting organized

Census results also show that buyers are looking for more storage space and for increased opportunities for organization.

“The feature that people most want is a walk-in closet in the master bedroom,” Melman said. “That’s important in family organization.”

Melman added that many dual-income couples want to get dressed and out of the house quickly, so having a walk-in closet would help them live more efficiently.

In addition, Melman said, “Linen closets always rate in the top 10. [They hide] clutter and help organize the household.”

A well thought-out laundry room with good lighting, ventilation, and appliances also is a top characteristic for new housing, noted Melman. Disorganized laundry rooms never bode well for a family’s orderliness.

Additionally, many buyers are looking for larger pantries to help with entertaining and storage. Plus, according to the Census Bureau, 19 percent of new single-family homes sold had a garage that could hold three or more cars—giving owners more options for storage space as well.

Making investments in quality

Buyers also are looking to invest in top-of-the-line, name-brand appliances. “They are looking for value,” Melman said.

However, quality comes at a cost. Buyers are sacrificing other luxuries, including the addition of specialty rooms or outdoor casual living spaces.

“If this were seven years ago, media rooms and outdoor kitchens would be among this list. They were pretty popular in 2003, 2004, 2005. If you need to cut costs, those are the features that you would drop. Those are some things that people can do without,” Melman said. “They are willing to take a grill or firepit instead.”

Ilyce R. Glink is the author of several books, including 100 Questions Every First-Time Home Buyer Should Ask and Buy, Close, Move In!. She blogs about money and real estate at ThinkGlink.com and at the Home Equity blog for CBS MoneyWatch.

4 comments

  1. Susanne Hunter says:

    I would like to see a column on when it might be smarter to NOT upgrade. Take the case of a 70-year old widow living in a home purchased in 1976 at $70,000 and paid for in 1995 by making extra payments on principal. The house is in a very good location and is on a half-acre lot. It is a brick rambler with large yard in front and back (there used to be a swimming pool, which was filled in). She does not want to go through the hassle and decision-making involved in upgrades. To tell the truth, the best upgrade would be to tear it down and re-build. There are no walk-in closets and the bathroom on the main floor is small. Two small bedrooms and a size-able “family room” which had been a car port before the house was bought (no basement under this room). There’s a full basement which became unfinished due to a storm drain backup; it could become finished by a buyer. Why should this woman do anything but sell “as is” even if it means selling for $250,000 instead of $400,000? At her age, the place she would move to would likely not cost her more than $250,000, and even if it did, she can afford a small mortgage if necessary. Don’t you think there are any buyers out there who would purchase a live-able brick rambler in a good location for $250,000, which they could renovate themselves as time and money permit?

  2. Barbara Armour says:

    Can Ilyce Glink source her data/stats?

  3. Ilyce Glink, Managing Editor, Equifax Finance Blog says:

    I’m not sure what you mean, Barbara. We have cited our source details and link most of them above. Thanks for reading.

  4. Ilyce Glink, Managing Editor, Equifax Finance Blog says:

    Suzanne: Thanks for your question. Whether to make the move to renovate depends on a complicated equation that is equal parts time, money, motivation, competence, and resale value. In your example, the widow may not need any more room but might like to live with new appliances, and a new bathroom. On the other hand, is the best option for the house to tear it down or can someone with some money and vision come in and re-imagine this property?

    We’ll be sure to explore this question more fully in an upcoming blog. Thanks for reading.


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