Today's new home buyers want larger dwellings with plenty of options, according to a panel of Maryland builders.
Thomas Hyde, Rick Centra and Dan Ryan spoke recently to the Frederick County Association of Realtors about trends in new home construction. The meeting was the last for the Realtors' group until September.
Hyde is president of the Frederick County Building Industry Association and vice president for land with Miller & Smith. He said the Frederick County market is strong for new homes, but builders are running out of approved lots for construction.
With less land available and home prices recovering after the recession, future buyers will find real estate more expensive, Hyde said.
Ryan, president of Dan Ryan Builders, said the home building industry has been through the worst recession in history.
"It was a tough winter. Hope the market picks up in Frederick County in the spring," Ryan said.
His firm builds in seven markets. The Frederick County market is doing better than Washington County and the West Virginia panhandle, Ryan said.
Centra, president of Advantage Homes, said his firm is bullish on the market, but cautioned that rising interest rates could affect the forward momentum of the industry.
"Buyers want bigger houses, but their incomes are not going up," Centra said. "They have to control their expectations."
Green construction is becoming more prevalent, said Ryan, driven by government mandates and guidelines.
Hyde said his customers are loading up on options and want larger homes, but no lawns to take care of. The result is innovations such as rooftop terraces over the garage for inviting guests over for a barbecue.
"It is all about personalization," Centra said. "We can't beat the cost of an existing home dollar for dollar, but what we can offer is a personalized home, built for the customer."
Today's buyers, who tend to be younger, want charging stations for devices; cubbies for backpacks and boots; homework centers where the parent can be in the kitchen and still see the children; dog parks; and other neighborhood amenities.
Centra said 90 percent of the customers who bought Advantage homes have gone to the company's website.
"You have to have a first-class website," Centra said.
"You don't need print media. It doesn't work anymore," Centra said. "It is a lot different than it was five years ago."
Hyde said only a few years ago he had attended a company meeting and one of the executives said he didn't want Miller & Smith to put floor plans on the website because another builder might steal the design. Today, Hyde said, you have to have that information on the Internet and in social media.
Buyers want the neighborhood to have open space, tot lots, pools, recreation centers and more, Hyde said.
Hyde said each year Miller & Smith build a green home for national shows and look at how some feature may eventually be incorporated into general construction, depending on the cost for both the builder and the buyer.
Centra agreed, saying cost analysis has to be made on solar and geothermal systems. "I think it could be more like five to 10 years before they become more common, not just one or two years." A key to energy efficiency is designing the elements into the home initially rather than the expense of adding them later.
Interviewed after the presentation, Hyde said 83 percent of homes sold by Miller & Smith in Frederick County are through a real estate broker, compared to 65 percent in his company overall by buyers not using a Realtor.
In 2013, 263 new homes were sold in Frederick County out of 3,112 total (new and existing) homes sold. In the first quarter of 2014, 45 new homes have been sold out of an estimated 549 homes sold in the county, Hyde said, noting that the quarterly numbers could be higher as some properties take a while to be recorded.
Michael Kurtainyk, president of the Frederick County Association of Realtors, said builders and Realtors work well together.
"It is all supply and demand. When the inventory of existing homes is down, people look at new homes and vice versa," Kurtainyk said.
Ed Stanfield, a Long and Foster Realtor, said those who sold homes need to have certifications in fair housing, but commercial real estate professionals do not need to have that requirement.
Stanfield, who sells both residential and commercial real estate, is chairman of the FCAR Commercial Committee. He just finished two years with the Maryland Association of Realtors' Commercial Alliance, made up of commercial brokers. He is hoping to bring more commercial agents into FCAR, which has nearly 1,000 members in the real estate and related fields from mortgages to banking and legal representatives.
Copyright 2014 - The Frederick News-Post, Md.