What's In, What's Out with Homebuyers in 2007
The housing correction. My prediction in the 2006 "What's In, What's Out" I forecasted a soft decline in home prices in most markets. In 2007 I project a 5-8% decline in prices on average between single-family and condominium homes.
Homes that are priced right. It isn't the boom market of 2005, look at only the sold comparable's from the last six months. Forget the cocktail party chit-chat when all you heard was record prices in the shortest market times in U.S. real estate history.
Online home valuation sites ( Zillow.com). Mainly those that utilize up-to-date and reliable home sale data. Technology is great when it works, but tread carefully with online valuation web sites. Ask yourself how long does it take your recorder of deeds and real estate transactions to record them? If up-to-the-minute, okay, otherwise plan the lead time into the online valuation to spew out accurate information.
Market timing. Many buyers and sellers were on their own timelines in 2006 and they missed opportunities that were created by not recognizing the real estate markets ebb and flow. Spring is high market, the most demand by the largest number of buyers. Summer is a good market, fall is fair, and winter is the remnant market, the left-over buyers and sellers from the high, good, and fair markets.
Savvy buyers. With interest rates historically low and bent-up demand from a soft year in 2006, the deals and lack of frenzy won't last long. "Deferred demand" from 2006 could ignite a mini-frenzy in some markets.
Third places or officetels. Home offices are on the rise, though those who work from one, need more than a coffee shop or hotel lobby for business meetings. Look for alternative work spaces that bridge the home office with hourly rentals of conference room-type spaces that offer technology and privacy.
Upscale garages. It's no longer the out-of-sight-out-of-mind dumping ground. Today's garage owners want them decked out with cabinet and storage systems, mini-refrigerators, insulation, heating and air conditioning and durable but residential-looking flooring.
Caving. Man caves and Mom caves are coming out of the closet. Personal dedicated space for one person in a household can go and work on projects or "chill" without being disturbed and if so only in an emergency.
Two home offices. Rising gas prices and commuting times have created more two-work-at-home families. Size matters, make sure each is at least ten-by-ten feet.
Rejuvenation rooms. A one-stop space for exercising, meditation, yoga, sauna and fancy steam showers. Showers are going upscale too. Waterfall fixtures, programmable temperature and water flow are the next trend for "showerers".
Heated patios, walkways and driveways. Northern baby-boomers are tired of shoveling and are looking for ways to decrease winter maintenance, plus many have discovered how also heating the patio can add an extra couple of weeks enjoyment in spring and fall.
Snoring rooms. Offered as options in new homes, adjacent, second bedrooms to the master, offer relief from the "buzz saw" and an alternative to the couch. A godsend for millions of relationships nationwide.
Modular Housing. Many think of the out-dated double wide as the typical modular, but modular options and quality have exploded from the top end 11,000 square foot home, with every whistle and bell, complex finishing details, to the bread and butter 1200 square foot starter home. Low-cost, factory-built construction and quick conception to foundation times, make this the affordable wave of the future.
Sustainable Design. Sustainable design is based on three areas; energy conservation, indoor air quality, and resource conservation. Viewed as new-age in construction circles, sustainable design looks at homes holistically, and not just a group of unrelated systems thrown together. Natural forms of energy, such as wind, solar, and geo-thermal if available on-site, are maximized.
Structured wiring. Right up there with all the buzz about green homes is structured wiring, now entering the main stream must-have for technology based home buyers. Coaxial TV cable (RG-6), Category 5E voice and data lines, distributed radio, remote camera security are wired through out a home into multi-outlet boxes called in the trade, home network centers.
Mixing finishes on kitchen base and wall cabinets. Matchy-matchy is out in kitchen design. The new look is to have stained-wood bases and painted wood upper cabinets. The old-europe-look rules, but with today's appliances.
"As is" in home sale marketing. Anything went in the boom market, but if you're planning to use "as is" in 2007, forget it. The two letter-two word kiss of death, buyers see it as a red flag about the home and you the seller. You have too much competition to be chasing buyers away.
Buyer incentives. Free cars don't sell houses, realistic pricing does. Gimmicks only confuse and distract buyers. Cut to the chase and deduct the cost of your free-with-purchase from your current price and send the signal to buyers that you're selling real property not personal property.
Endless Open Houses. The open house pendulum has swung from " the house sold in the first day" to "we need to have our house open every Sunday". Desperation is when your home is open every Sunday. Buyers know and track it. Plan on every three weeks to have a public open house.
Over-full-price offers. It was a strategy in the boom market to under-price a home and let the market set the selling price. Not today, one thing that won't change in 2007 is that every buyer will want a deal, and walk from one if they don't get one.
Bedrooms not large enough for a bed. In the boom, rehabbers and developers learned the fastest way to profit was to increase the room count of a home of an existing home. Bedrooms shrunk to walk-in closet size when a four-room one-bedroom was gut-rehabbed into a four-room two-bedroom. Or, the doorways and windows eliminate required wall space. Savvy agents kept asking, can you fit a queen-size bed in either room? And the answer was usually, no.
Loads of glass upper kitchen cabinet doors. Buyers say it looks great, but many who specified and experienced it, firsthand don't have the time to keep their kitchen cabinets organized. Plus if you hate washing the windows, having more glass in a greasy room like a kitchen is high-maintenance.
Bowl-shaped above-counter bathroom sinks. The splashing and over-all up-keep have earned these the reputation of nice to look at, but don't want one.
Any shiny metal finish. Brushed nickels and pewter's are in and antiqued and polished brass is out.
Stainless-steel refrigerators and dishwashers are a fading trend. The cold look and higher maintenance of steel is shifting buyers to specify warmer colors in kitchen appliances.
Spiral staircases. Once the rage for mid-seventies make over's, now death to a home seller. The boomers have aged, their kids don't like them, unfriendly to pets and young children. Take yours out and put in a standard staircase (inside or out) before you sell.
On the way out.
Bamboo floors. The first reviews are in on this popular eco-friendly flooring, and they're not pretty. Easily dented and scratched, and prone to warping from variations in our climate and humidity levels.
Hardwood laminate floors. The word is out that these noisy poor relatives of solid hardwood that don't stand up to multiple sanding's to change color or to remove stains.
Home sellers who smoke in their home while it is being marketed. Buyers hate second-hand and stale smoke odors. Marketing your home is not the same as living in it. If you have to smoke go outside.