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by Elise Platt

Anyone whoʼs been in the housing industry for more than 30 years, as I have, realizes that after every bust cycle there emerges a “New Normal.” After the high interest rates of the late 1970ʼs, new financing vehicles changed the way we sell housing and, in fact, were precursors to the practices that triggered this latest debacle. After the deep slump in the late 80ʼs early 90ʼs came the shift from regional and local entrepreneurial builders to the large publicly held national builders whose responsibility to Wall Street caused many NOT to react flexibly and sensibly early in this downturn — hence the huge standing inventory in many markets. So, what will be the new normal now? Simplify Stay sensible and practical Create real value. Demographics Still Rule One thing we know for sure: Demographics are still the underlying foundation of the housing market. And the demographics are positive, different, but positive. The coming decade is an hourglass market, a decade of big generations. The Baby Boomers once 76 to 79 million strong (depending on which statistic you read), and still at about 70 million, are the top of the hourglass. The leading-edge Baby Boomers will begin to reach 65 in 2011, and those in the tail-end of that wave are not yet 50. The outlook for senior housing is strong for at least a decade. Generation X is the very slender center of the hourglass, numbering only 41 to 46 million (again statistics vary). The number of people reaching age 55+ starts to dramatically drop off as generation X comes of age, around 2025. Next is the Millennial generation, or Generation Y, bless their young hearts! There are about 76-80 million of them, as big as the baby boom (statistics fluctuate again). These young people, who start reaching age 30 by 2011 or 2012, will be a big home-buying influence in the coming decade. (Bear in mind that someone needs to buy baby-boomersʼ houses.) So what does this have to do with what you face today and the “New Normal?” Given that weʼre coming out of the worst housing market in history and struggling to survive every day, how does looking toward the future help? Knowledge allows you to focus anew, do smart planning, respond to market growth and changes, and not just react to what happened yesterday. That is part of the “New Normal.” Simplify, stay sensible and practical, and create real value. Housing is a Long-Term Business Building housing is a long-term business, and building senior lifestyle housing with amenities is even longer-term. Letʼs look at some strategic questions that should help in the future and with the “new normal” today. http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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Should senior neighborhoods be so big? Is the amenity-based community the only option? Should senior neighborhoods be part of larger master-planned communities? Can you build age-oriented housing without an age restriction? Is there an ideal price point for senior housing? 1. Should senior neighborhoods be so big? The conventional “senior housing” model is limiting. It requires large parcels of land and a great deal of capital to support the upfront investment needed to make these amenities-rich communities viable and alive from inception. This is great if you are a large or national builder with time and resources on your side. If not, simplify and stay sensible in size. If you are a smaller, more entrepreneurial homebuilder, serve this population differently. Look for close-in parcels near existing amenities such as lakes, seasides, city/town centers, universities, fishing, hunting, even shopping and entertainment. Develop small to mid-sized, mid-priced jewel boxes, walking neighborhoods that are part of existing infrastructure. Even where schools are not the best, you can create successful infill senior enclaves. These opportunities abound all over the country. Create real value. If you are the developer/builder of a large senior community stymied by the task, choose the developer role. See if you can “pod” your plan and sell parcels or lots to a selection of other builders to build in your community. This creates “neighborhoodlets” within the larger neighborhood and allows you to amass capital An infill community in a walkable neighborhood to build amenities while still controlling the appearance of the community. Many is an attractive option for urban empty nesters. builders need improved lots today, so there are opportunities now. Stay sensible and practical. 2. Is the amenity-based neighborhood the only option? Your amenities should depend totally on where you are building, the scale of your community and the cost of both your homes and the “carry” on the amenities for your potential buyers. People view amenities differently. Some see them as their key to a whole new life, others as a nice plus, and still others as a burden. You must understand who your buyers are and what their priorities are. Simplify and create real value. If you are near a commercial or town center, a university, a public amenity such as a beach, or a golf course, for instance. Your amenities package can be very modest, if you need one at all. Your buyers will appreciate not paying for what they donʼt use. Often, services are the best amenities you can offer. They cost nothing to capitalize. Create real value and be practical. If, on the other hand, you are building further afield and need to create a sense of place to motivate buyers, you need more amenities. Remember green space, trails and walking paths still rate number one on all amenities surveys. Passive and active outdoor activities cost less than indoor functions. Adult playgrounds (actually outdoor exercise equipment), community gardens, outdoor band shells, “central parks” all serve well for the long term and cost less to build and carry than 20,000 sq. ft. clubhouses. As with everything else during the last boom, clubhouses have become too grand, too big and too expensive. Downsize and simplify. Be practical and sensible. 3. Should senior neighborhoods be part of large master-planned communities?

Bike trails and walking paths are low-cost amenities.

Why not? For years the largest master planners in the country have carved out senior neighborhoods in their giant communities in places like California, Texas, Florida, Arizona, Nevada, and Colorado. Seniors can take advantage of amenities of the overall http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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places like California, Texas, Florida, Arizona, Nevada, and Colorado. Seniors can take advantage of amenities of the overall community and still have a place of their own, perhaps with a small park and pool. Being part of a large master plan provides a natural resource of buyers for the builder and resellers for years to come. These are great opportunities. Take advantage if you can find them. Simplify. Be practical and sensible. 4. Are there opportunities to build age-oriented housing without an age restrictions? Of course, no one can discriminate in non-age restricted communities, but certain locations and types of housing appeal to boomer buyers without the constraint of an age restriction. We have built many very successful empty-nester oriented neighborhoods without an age restriction. These attract the vast number of Baby-Boomer buyers who do not “feel old enough” for “senior” housing. The highend buyer, especially, looks favorably on these neighborhoods. Simplify and create value. During this downturn, many builders successfully petitioned local jurisdictions to lift age restrictions on communities to expand the pool of potential buyers. Often, mature singles and professionals without children want the same neighborhood qualities and amenities as seniors and these buyers mix together very well. Be sensible and practical. Going forward, we need to look hard at the large “seniors only” model and decide if these communities make sense for your company and for your market. My personal opinion, for what itʼs worth, is that very few areas and builder organizations truly can support large “seniors only” communities. I am an advocate of mixing seniors into master planned communities, either in their own neighborhoods or just allowing the generations to blend together in lifestyle neighborhoods. They actually get along very well, and seniors tell us it keeps them young to be in a multi-generational neighborhood. Create real value. 5. Is there an ideal price point? Grandparents really want to be near their grandchildren. Multi-generational communities No, there is no ideal price point. All development pricing should be determined by are appealing to Boomers. your location, your buyer profiles, and market demand. If, however, you are building a large-scale community, you need to create a mix of housing types and price points. In general, senior housing should follow the rules of attached homes and stay 10-20% below the single-family comparables in the overall marketplace. Stay sensible and practical. No matter what you decide to do now, remember the three basic rules of the “New Normal:” • Simplify. • Stay sensible and practical. • Create real value. And if thereʼs one overriding rule, it is to be flexible, and always look for new opportunities. -------------------------------------------------------------------------------------------------Elise Platt is president of E.A. PLATT & CO. a 30 year old award-winning firm, serving as a marketdriven counsel to builders, developers and financial institutions across the country in positioning and site-specific planning, marketing, and sales. Platt has experience in good times and bad, with neighborhoods that stand out and sell even in difficult, competitive environments.

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Along with Barry A. Berkus, Platt produced “NEST” a series of prototype demonstration houses at the NAHB from 1983-1990.

by William J. Devereaux, Jr.

Do you want to sell more single-family homes to the active adult market? Then value engineer your designs and donʼt tell anyone! This market, while changing, is steadfast in its demands. You need to offer everything that they want, or they wonʼt buy — because they donʼt have to. This fact has been the same throughout our last half-dozen recessions. Your prospective buyers are not in a rush (even in good times), and usually can just stay put. But here is where our opportunities lie: Donʼt build into your product or community elements your buyers really never had to have in the first place: • • • • • • •

Second floors (Make it an option, but avoid required rooms) Three-car garages (But donʼt forget storage) Unnecessary rooms (Formal living or dining room in a great room product) All brick (But donʼt shortchange the street view) Complicated house and roof forms The 50,000 sq. ft. clubhouse Volume ceilings (But option them to younger active adults, or use 9-foot ceilings throughout).

PLANS This buyer, while wanting everything, does seem to have some basic demands. The typical active adult buyer of single family homes is looking for two bedrooms or more. The plus room could be a den (that should be able to be converted into bedroom number three) or it could be a straight third bedroom. The younger empty-nester might accept the second or third bedrooms on a second floor, but donʼt try that value engineering on the older active adult — get everything on the first floor at almost any cost. So far, we havenʼt value engineered much, but here are two areas where we can: room type and room count. For the formal buyer — yes, provide the formal living/dining rooms. But for the casual buyer, eliminate the living room and possibly even the dining room, and provide a large, open great room instead. One way to cover all the bases is to provide a flex room: either formal dining, or living or den. This approach can take 150 sq. ft. out of a home without disappointing our active adult buyer. Other obvious ways to value engineer without showing it are: reduce the amount of hallway space, reduce wasted space (unfurnishable/unusable areas), use window placement to make smaller rooms appear larger, use 9-foot ceilings instead of vaulted ceilings, include some high glass, shrink the master bath with a larger shower instead of an oversized tub, and make hallways (when necessary) into art galleries, or have wet bars off them, or work spaces — double-use these spaces. The shape of your floor plan can affect the cost to build. Not every plan needs to be a box, but try to keep your offsets in the front to get the maximum effect on the street elevation. Front porches play a big role in our boxy floor plan, and our buyers will pay for porches where they may not go for overly complicated plans. The active adult buyer will pay for options. Value engineering can allow for pre-planned sunrooms, porches, expanded rooms, basements and second floors. Make the house work for your buyer as the standard house, then option the add-ons and extras. http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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The example below shows the possibilities. If you know your buyers, their lifestyle/needs and price constraints, you can adjust. In this case, a 2400-sq. ft. plan was value engineered to 1800 sq. ft. without giving up the have-to-have items.

Existing Plan (View Enlarged .PDF image)

Revised Plan (View Enlarged .PDF)

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ELEVATIONS Here is where our active adult buyer will let us cut cost. Overly complex roof structures, gables on hips on gables, high front-to-back roof lines, extensive use of expensive materials and detail — these are not necessary to make the sale. That doesnʼt mean that we should strip everything off the home, but we can simplify. Concentrate on developing and keeping “character” in your product, even if it means limited stone/brick and just enough detail to bring that warmth to your streetscape that our buyer still is insisting on. Attention to the front door area, window placement, entry porch, and possibly even a dormer make a one-story home feel more impressive. And — just maybe — add a “feature” window in the front elevation. Our buyers donʼt want to be perceived as stepping down in prestige, but moving into a house and community that more than meets their lifestyle.

Existing Elevation

(View Enlarged .PDF)

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Revised Elevation (View Enlarged .PDF)

CLUBHOUSE We still need to provide the clubhouse up front, or as soon as possible. But we can value engineer it (quietly!) The first big decision is the indoor pool. With that, we would need 8500 to 9500 sq. ft. Without it, we can get by with 7000 sq. ft. or less, if we have to. Focus on a few activities (social and fitness), with elegance being preferred over pure square footage. Theming the building and the community still is important, but keep the cost to build and the cost to maintain in mind. This is the place to be imaginative and, as with our house plans, make the minimum feel gracious. http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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with our house plans, make the minimum feel gracious.

LOCATION This axiom is one we forgot over the past few years. Location still is very important to this buyer — whether itʼs only a few miles from a great town or amenity, or accessible to the kids and grandchildren, or near required facilities. Go back to doing your homework here and discover where your active adult market wants to live, not just where you can get an active adult community approved.

PRICE This is the whole reason for this exercise. We are under pressure to keep prices right for the obvious reasons: the economy, the investments, and the lower price our buyers will be getting for their homes. But there is one other reason we donʼt seem to want to talk about: resale. The active adult market is changing dramatically. The younger active adult may not be looking for this lifestyle. The idea of an age-restricted community may not have the universal attraction it once did, as younger retirees may be more inclined to want to stay in their existing community fabric. I donʼt believe that these large restricted communities will disappear, but they will attract only a smaller percentage of the market. And that is good news! With the builderʼs knowledge of how to design for aging and universal design, we will see the attraction of active adult product in the cities and the inner suburbs, along with the conventional locations. It will be an opportunity for all builders of all sizes in a variety of locations. But value engineering is here to stay. Yes, the active adult market wonʼt compromise much — but as builders and designers, we still have a great opportunity here. First and foremost is the return of the Baby-Boomers in large numbers. And secondly, all of us in this business have the instincts for providing what our market wants and being able to “turn on a dime,” relatively speaking. So keep looking at your product and your buyers, and keep trying to produce the value engineering that the active adult buyer needs without taking out the essentials. I hope these suggestions will help you move in that direction. -----------------------------------------------------------------William J. Devereaux, Jr. is the president of Devereaux & Associates, P.C., McLean, Virginia. Although specializing in residential programs, the firmalso is noted for recreational and commercial structures, resort villages, and manufactured housing components and systems. Widely recognized for design and planning achievements, Mr. Devereaux has received numerous awards for design excellence. Mr. Devereaux has been involved for the past thirty-five years in the design of thousands of senior homes throughout the East coast. This involvement has included land planning and unit and clubhouse design. Devereaux & Associates also designed BUILDER magazineʼs Lifestages House, which was built on the floor of the January 1999 NAHB convention in Dallas, Texas. This home was designed to allow the buyer to “age in place,” and was one of the highlights of the 1999 convention. Mr. Devereaux also is a contributing editor to BUILDER magazine.

by Ken Plonski

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The worst housing recession in a lifetime has shuffled the cards for both active adult home builders and their prospective customers. For home buyers, the economy has carved a deep gouge in their wallets, investments, retirement accounts and especially their home equity…which, for most, accounted for the largest percentage of their net worth. As a result, any housing decision they are contemplating is being driven by more frugal and practical considerations than those of people who were buying homes in the early and mid 2000s. Gone are the gourmet kitchens, home theatres and marbled bathrooms. Today, many builders — but not all — are finding that size, function, efficiency and, of course, cost, are key drivers for 50+ home buyers across the country. And they are pressing their architects, designers, construction managers and marketing staffs to find new and innovative ways to address the new realities of the marketplace. The reality of the market is reflected by a recent Census Bureau report that shows the size of the average single family home in America dipping from a peak of 2,521 square feet to just over 2,400 square feet in 2009. NAHB Chief Economist David Crowe cites a desire for lower energy costs and smaller amounts of home equity as major contributors to this trend. Chris Harrison is Senior Vice President of Construction for Robson Communities, based in their large and highly-regarded Sun Lakes active adult community just outside of Phoenix. After conducting focus groups with prospective buyers in 2008, Chris and other veteran members of the Robson management team knew they needed to make some changes in their product offerings to serve a buyer who was more interested in operational costs than opulence. They rolled their new product out in two Arizona communities in 2009, and with its resounding success, the new designs now are being introduced at all Robson Communities in Arizona and Texas. “The active adults weʼre seeing today are much more focused on things such as energy efficiency, maintenance costs, and how the home accommodates their lifestyle,” Chris said. “Weʼve also dialed back on some of the bells and whistles such as gourmet kitchens and home theatres in order to better align our homes with our buyersʼ pricing expectations,” he said.

Robson Communities understands the importance of buyer education, especially when it comes to energy efficiency and building science. They've converted a three-car garage in one of At the same time, Robson focused its attention on those areas of their model homes into an education center that helps their buyers the home that had a greater impact on its livability. Harrison understand the various design components of the home. points specifically to outdoor living areas and guest suites as two changes that better reflect the way todayʼs buyers are using the home. The company also teamed up with Mascoʼs Environments for Living program, which prescribes state-of-the-art requirements for energy efficiency and advanced construction techniques. The marketing team's new learning center (above) to educate buyers about the energy efficiency, comfort, durability and safety of the home. “Itʼs played an important role in explaining the changes weʼre making and how they benefit the buyer,” Chris said. Steve Romeyn, managing partner at Windsong Properties, a builder for the active adult market in the Atlanta metro area, also is reengineering his product to meet the needs and demands of a more pragmatic buyer. “We found that our prospective buyers, many of whom had visited with us on several occasions, were being impacted by declining home values,” Steve said. “They were telling us that they wanted to be in a $400,000 home, but that they were finding it hard to justify as they were losing value in their existing home. We knew we had to find a way to address that pricing gap,” he said. They took a look at their floor plans and discovered there

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They took a look at their floor plans and discovered there were opportunities to trim some square feet here and there to address the price expectations of their buyers. Steve said there is still a significant demand for the selected upgrades, but with the recent decline in home prices, “theyʼre just not gilding the lily,” he noted. “Instead they are opting for function, practicality and understated elegance,” he added. Windsongʼs buyers have also responded well to the changes, enabling the company to hopefully equal its 2007 sales pace in 2010 according to Steve. The company has addressed its buyersʼ changing needs by becoming more flexible and accommodating. For example, many of their homes once offered a shower and garden tub in the bathrooms. Today, thatʼs still an option, but only 10% of their buyers are selecting the option. “They realize they can live without it, says Steve. “We used to see $50,000 option packages, but today, itʼs about half that,” he added. A few years ago, garden tubs were a standard feature at many Windsong Propertiesʼ homes. Today, more practical buyers are Windsong also has remained true to some of the basic discovering they can do without the upgrade. tenants of active adult home design throughout the downturn, focusing on low-maintenance living and universal design features but, somewhat surprisingly, they have not seen an overwhelming demand for green building features. At Traditions of America, Managing Director Tim McCarthy is another builder who isnʼt seeing a great demand for green building features, with the exception of those that address utility costs. "Our buyers are sensitive to the homeʼs operating costs and, as a result, we do include energy efficient appliances, windows and HVAC systems,” he said.

Flex space, such as this loft/office, can be offered as an option.

Traditions, which is building five active adult communities in Pennsylvania priced from the $200,000s, has found success by bringing value and affordability to its base designs. And they, too, are benefitting from providing a good selection of options to the buyer. Tim specifically points to a plan that offers a second floor flex space option. Four years ago, about half his buyers were selecting that option. Today he says about 75% of his customers are adding the additional 800 square feet. “They see it as a practical addition,” he said.

Returning to the Atlanta market, active adult builder Jim Chapman Communities hasnʼt had to alter its floor plan sizes to remain successful. Owner Jim Chapman says the amount that his buyers are spending on upgrades has dipped a bit, but by and large, itʼs relatively on par with what they were experiencing a few years ago. “The buyers weʼre seeing are coming out of older homes and they appreciate the fact that they will have better appliances and bigger cabinets. They are tired of the lack of functionality in the old home and are looking to improve their lifestyle,” Jim said. He, too, says that universal design features are very appealing with the 55+ buyer, as well as those features that deliver a lower level of maintenance. Itʼs clear that builders are taking a hard look at their product designs today and finding new ways to accommodate the new realities of the market. Large formal living rooms and dining rooms are becoming a thing of the past, replaced by livable great room or more comfortable and entertaining outdoor living areas. The inclusion of expensive upgrades are now becoming optional items, which allow the buyer a greater opportunity to spend their precious housing dollars or the things that mean the most to them. http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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allow the buyer a greater opportunity to spend their precious housing dollars or the things that mean the most to them. While some people have seen the active adult as a very homogenous group, builders today are realizing that one size does not fit all, but the efficiency and functionality of the home appears to be something they do have in common. And what about the future? Do these builders foresee a day when they can once again embrace the size and opulence of the early and mid 2000s? They donʼt think so. According to Harrison, this downturn has significantly altered the buyerʼs perspectives. “This isnʼt a cyclical change. Itʼs forced us to build a better, smarter design with an eye toward efficiency and operating costs. The customers are smarter, too, and they are not likely to forget the lessons weʼve all learned from the past few years,” he concluded. Functionality and efficiency. Could they become the buzz words of the next decade? ------------------------------------------------------------------------------------------Ken Plonski, of Master Planned Communications, has worked in the 50+ housing industry for 30 years. Ken's experience includes directing public relations at the Del Webb Corporation, builders of Sun City communities, for 20 years. He also participated in the establishment of Arizona's Senior Industries Cluster, and has served as the Chairman of the National Association of Home Builders 50+ Housing Council.

Rittenhouse Square, a 100-unit affordable, four-story rental community for residents aged 55 and older, is as classy as any upscale market-rate apartment property. The developer, Thomas Safran, of Thomas Safran & Associates, says he builds communities that he would be happy to have members of his own family live in. His staff thinks likewise: the goal is to create a building desirable enough to attract everyone. The quality of the exterior and the interiors tell the story. Thereʼs a cherry-wood grand staircase (left), well-appointed community rooms, a 74-inch flat-screen television in the meeting room, a large, well-equipped fitness room, and a ground-floor garage. A mobile depicting musical instruments graces the lobby, and other art pieces installed throughout the community distinguish it from more conventional apartments. Outdoors, thereʼs an elaborate Asian-style landscaped courtyard that could grace any upscale resort, as well as a high-end barbeque grill. This package would attract any potential renter, but itʼs there to be enjoyed by residents with incomes up to 60% of the area median income. Rents range from $400 to $1,100 a month. The aesthetically pleasing brick building (right) and its features are only part of the story. The community is located in the Central Avenue corridor near downtown Los Angeles. Its development is part of the cityʼs effort to revitalize a currently run-down area that once was known for its jazz clubs.

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The Central Avenue Jazz Festival still is held in the neighborhood, paying homage to the areaʼs storied past. Rittenhouse Square is one of a few catalysts kicking off the areaʼs redevelopment. According to property manager Oscar Alvarado, the propertyʼs 4,000 sq.ft. of ground-floor retail space is attracting quality tenants to an area not yet recovered from blight. Thus far, the Subway sandwich shop and a local coffee house have rented space. The goal of the retail presence is to generate strong pedestrian activity along Central Avenue. To that end, the sidewalks have been scored and stained, and all the utility poles have been replaced with underground utility lines, creating unimpeded pedestrian access.

Most of Rittenhouse Squareʼs residents are in their late 50s, but many are in their 60s or early 70s. Fully occupied at its grand opening this past June, the propertyʼs waiting list keeps growing, as people become aware of its distinctive characteristics as the jewel of a neighborhood on the rise.

-----------------------------------------------------------------------------------------------------------------Story suggested and written by Evelyn Howard, Howard Associates, with input from Oscar Alvarado of Safran and Associates, and NAHB staff.

While the key housing indicators — job growth, starts, household formations — are still fairly anemic, there are some early signs within our sector that indicate that we may have hit bottom. Many architects and designers are reporting that they are once again busy: one designer said that her “business is exploding!” And membership in NAHB rose this month, for the first time since August, 2009. Thanks to the Home Buyer Tax Credit, many more existing homes were sold this spring than would have been sold without it. And, to the extent that retirees and others in the 50+ age range were able to sell their existing homes, theyʼve been able to then buy homes that work better for them. Some builders have been http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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existing homes, theyʼve been able to then buy homes that work better for them. Some builders have been able to take advantage of Government programs to build age-restricted seniors rental housing. And others who have been able to respond quickly to the changing conditions have continued to sell homes — generally smaller homes, at lower prices. This monthʼs issue is a comprehensive guide for coping with the changed market. Consultant Elise Platt explains what the “New Normal” is for our market. Architect Bill Devereaux details a case study in value engineering floor plans and elevations to meet these new market conditions. And writer Ken Plonski interviews builders to learn how theyʼre changing their production and sales practices to sell product and satisfy todayʼs prospective buyers. Earlier this month, actor and economic commentator Ben Stein addressed the annual meeting of the Building Owners and Managers Association, giving his opinion that “real estate will be glorious again.” Now, no one whoʼs actually been in the building business over the last two years expects anything like that to happen soon — perhaps not in this decade! But Stein was right to point out that people have to live somewhere, and that buyersʼ expectations, while reduced, will expand when economic conditions allow are favorable. But he was also smart enough not to forecast a date for “glory” to return, and Iʼm not going to, either. Instead, weʼll all keep on keeping on, remaining flexible — hoping the upturn has begun, and will continue.

Mike McGowan CAPS,CGB,CGR,CGP McGowan Builders

by Paul Emrath, Ph.D.

Even people who aren't in the housing industry are probably aware that a key measure of new construction is housing starts. The number of starts is reported every month by HUD and the Census Bureau, and picked up by firms on Wall Street, used by a variety of industry stakeholders, and covered heavily in the press. For a long time, NAHB has thought it would be desirable to have an equivalent statistic for the 55+ housing sector. Starts are generated from the Survey of Construction (SOC), which is funded by HUD and conducted by the Census Bureauʼs Manufacturing and Construction Division (MCD). In the late 1990s, NAHB led a coalition of 50+ housing industry groups that sent a formal recommendation to MCD that the Survey of Construction be expanded to include a question asking builders if the single-family homes theyʼre building are in age-qualified communities or not. At that time, the Census Bureau refused — primarily on the grounds that builders responding to the survey often would not know if they were building in communities with age restrictions. However, NAHB raised the issue again when it was time to redesign the SOC in 2006, with the Chair of NAHBʼs 50+ Housing Council sending letters to the Director of the Census Bureau. This time, the effort met with better success. The MCD successfully tested a new question on age restriction, and the question began appearing on the SOC questionnaire in 2009. It will be some time before responses appear in tables published by the Census Bureau. However, the information is available in a public data base, allowing users to tabulate starts in age-qualified communities from the SOC data for the first time.

Number of Units According to the new data, 9,100 single-family homes were started in age-qualified (or, as the SOC question literally reads, agerestricted) developments in 2009. As most industry participants know, home building activity was at a point of historic weakness in http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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restricted) developments in 2009. As most industry participants know, home building activity was at a point of historic weakness in 2009, with total single-family starts that year at their lowest by far since 1945. The number of starts in age-qualified communities should be viewed in that context. The total of 9,100 age-qualified starts can be broken into the nine Census Divisions, as shown in Figure 1 (numbers may not add precisely due to rounding).

More than 40% of the age-qualified starts were in the South Atlantic division, and another 21% were in the Middle Atlantic division that includes only 3 states (New York, New Jersey, and Pennsylvania). This is especially notable for the Middle Atlantic area, which ranks next-to-last among the nine divisions in terms of non-age-qualified starts. The SOC is based on a relatively small sample of approximately 900 of the 20,000 permit-issuing places in the country, so margins of error are likely to be large, and that should be kept in mind, especially when evaluating numbers by Census division. Housing starts in age-qualified communities are relatively rare events that are difficult to capture with extreme precision, even before being partitioned into nine divisions.

Size The SOC collects some information on the characteristics of the age-qualified units started, and this can be tabulated and compared to characteristics of single-family units started in developments that are not age-qualified. It often is difficult for occupants to estimate the size of their homes, so it is particularly useful to collect this information in the SOC, where it is often being provided by builders with access to blueprints. In the SOC, size is defined as completely finished floor space, including space in basements and attics with finished walls, floors, and ceilings. Under this definition, the average size of single-family homes started in 2009 was 2,360 sq. ft., and the size did not change drastically if the homes were in age-qualified communities. However, the age-qualified homes show considerably less variance (Figure 2).

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Age-qualified single-family homes tend to be concentrated in the band between 1,600 and 3,000 sq. ft. In 2009, very few of the agequalified single-family units captured in the SOC were smaller than 1,200 sq. ft., and none at all were larger than 4,000 sq ft.

Price Although single-family homes were not generally larger if built in age-qualified communities, the prices of the age-qualified homes tended to be somewhat higher. In 2009, the average price of new single-family homes sold in age-qualified communities was $299,000, compared to $247,000 for single-family homes built in communities that were not age-qualified. The average price difference is not related to features of the homes in an obvious way. Central air conditioning is somewhat more common in age-qualified single-family homes (present in 99% of the starts, compared to 89% for homes not built in age-qualified communities), but fireplaces are somewhat less common (34% of the age-qualified starts, versus 49% of non-age-qualified). In general, house price differences can be the result of geographic construction patterns, as prices are known to be higher in certain parts of the country. The divisional distribution of age-qualified and non-age-qualified starts doesnʼt provide a clear-cut explanation of the average price difference, however. Age-qualified starts had below-average shares in both the relatively low-cost West South Central and the relatively high-cost Pacific divisions. Locational premiums also are possible within census divisions, of course. Lot prices may be higher in areas near a coast, for example. The SOC doesnʼt provide that level of geographic detail, but it does show that builders paid more for single-family lots in age-qualified communities in 2009 (median $50,000 vs. $40,000 in non-age-qualified communities) even though the lots tended to be smaller (median of about 7,000 sq. ft. versus more than 10,000 sq. ft.). House prices also may be related to community amenities. A previous study undertaken by NAHB has shown that some form of community recreational facility is extremely common in age-qualified communities. Results from a statistical model developed by NAHB show that, controlling for a large number of other factors, the presence of that type of recreational amenity increases the value of a standard home from $212,100 to $221,600. Effects like this are outside the scope of the SOC, which doesnʼt collect information on community amenities. NAHB and the Census Bureau discussed the possibility of collecting that data during the last SOC redesign, but rejected it on the grounds that a builder of a particular housing unit wouldnʼt able to predict accurately, at the time the unit is started, the community amenities that would be present when an the entire subdivision is completed. Although the SOC data now identify housing starts in age-qualified communities, they donʼt identify starts in communities with amenities that attract primarily 55+ households, even though these communities are not age-qualified. In some cases, these may be close substitutes for the age-qualified product and have a significant impact on local 55+ housing markets. The data used in the http://www.nahbenews.com/nahb50mag/textonly/printallPF.php?id=nahb50mag20100625

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close substitutes for the age-qualified product and have a significant impact on local 55+ housing markets. The data used in the previously-referenced study and available from MetLifeʼs Mature Market Institute indicates that on a national basis, about two-thirds of active adult housing (defined as housing that attracts mostly 55+ buyers) is built in communities that are not explicitly agequalified. --------------------------------------------------Paul Emrath, Ph.D., is NAHB's Vice President for Survey and Housing Policy Research.

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Look! No Hands! This bathroom fan-light-nightlight combination from Broan is not only Energy Star rated and incredibly quiet (0.7 Sones), it also senses the humidity in the bathroom with reliable, ceiling-mounted sensors. When humidity rises, it turns itself on, and once the level falls, it turns off at whatever time you've chosen — from five minutes to 60 minutes after the mist has cleared — or just hit the off switch to override. For more information, view the Broan company web site.

Four Shower Heads in One Boomers love options, and this handheld shower system from Kohler give them four variations on the spray by simply turning the sprayface. With no small dials to manipulate, it's easy to use, even for those with limited hand mobility. It offers variety more affordably than the more complex multi-head configurations. For more information, view the Kohler company web site.

Lots of Heat, but No Flame KitchenAid's Architect Series II induction cooktop transfers heat directly from the element to metal cookware without flames or red-hot burners. With nine precise heat settings, it's as quick and responsive as a gas cooktop, with no more worries about setting an accidental fire. An alert light lets users know if the surface is still hot.

For more information, view the KitchenAid web site.

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