Builders Tweak Floorplans for Growing Segment of Buyers

Homebuilders are changing their floorplans to accommodate more people living under one roof. As adult children and aging parents move in, home owners are finding the need for more defined, separate housing corridors within their homes.

For example, homebuilder Lennar is expanding the offerings of what it calls the “Next Gen” house. Introduced in western states like California, Arizona, and Texas, Lennar is now taking its “Next Gen” floorplan to North Carolina. The single-family home features a second door, separate from the main entrance, that leads to a 500-square-foot suite for a private residence. There’s also a door inside the main house to access the suite.

“We market it as two homes, one payment,” says Trish Hanchette, Lennar’s Raleigh division president.

Homebuilders also are finding flexible first-floor space is in high demand. The spaces can be used as a mother-in-law suite or changed into a nursery, extra bedroom, or home office.

Some in the housing industry are also calling some flex rooms “bounce back” rooms — so named for adult children who have moved back in with their parents because they're struggling to make it on their own.

“The number of 22- to 30-year-olds that are still living at home is at a record high right now,” says Hampton Pitts, an executive vice president with Ashton Woods Home. “So you have that college graduate that’s back at home looking for a job and maybe got their first job but not ready to be in an ownership or rent situation.”

Source: “Builders Target Families with Multiple Generations Under One Roof,” RISMedia (Jan. 8, 2013)

New-Home Construction Bounces Back, Soars 9.3%

New-home construction and building permits — a future gauge of construction — surged last month, slowly helping to pull the new-home market out of one of its worst years for home building.
Builders broke ground on more homes in November, a 9.3 percent increase over October, reaching the highest level since April 2010, the Commerce Department reported Tuesday. Year-over-year, new-home starts were up 24.3 percent in November.

Home construction increased to a seasonally adjusted annual rate of 685,000 homes in November. However, while it’s an improvement, the rate is still below the 1.2 million home pace that economists consider healthy for the new-home sector.

November’s increase was mostly driven by construction of multi-family homes with at least two units, which soared 25.3 percent in November. Construction of single-family homes increased 2.3 percent for the month.

Building permits jumped 5.7 percent in November, the highest increase since March 2010, with the increase mostly driven by apartment construction permits.

Builders Feeling More Confident

Meanwhile, for the third consecutive month, builder confidence in the new-home market continued to edge up, according to the National Association of Home Builders/Wells Fargo Housing Market Index for December. The index is at its highest point since May 2010.

While the index reached 21 in December, it is still far below 50, a reading which indicates more builders view conditions as good rather than poor. The index hasn’t reached that point since the housing boom in April 2006.

“While builder confidence remains low, the consistent gains registered over the past several months are an indication that pockets of recovery are slowly starting to emerge in scattered housing markets," Bob Nielsen, chairman of the National Association of Home Builders, said in a statement. "However, the difficulties that both builders and buyers continue to experience in accessing credit for new homes are holding back potential sales even in areas where economic conditions are improving."

Source: “Apartment Construction Spurs 9.3% Jump in Housing Starts, But Level Remains Low,” Associated Press (Dec. 20, 2011); “U.S. Nov. Housing Starts +9.3% to 685K; Consensus +0.3%,” Dow Jones International News (Dec. 20, 2011); and National Association of Home Builders