Real Estate Consulting & Sales | Residential + Commercial

Smaller home sizes are in

It’s no secret, today’s builders are making homes more effiecient and scaling back square footages in response to buyer preference and the current housing market.  Traditionally builders always built bigger, but today’s buyers are more concerned about cost and smart design.  Today’s floor plans maximize square footage and eliminate “wasted space,” together these two factors result in increased cost savings to buyers. 

Builders hope that smaller sells: Local developers say the trend in new homes will be less square footage and maintenance

  Source: The Register Guard
Publication date: 2010-06-08

By Diane Dietz, The Register-Guard, Eugene, Ore.

Jun. 8–As new-home buyers emerge anew from the recession of the past couple of years, they’ll want a different house than they ever bought before.

Sought-after houses, so the theory goes, will be smaller, cuter, cheaper to own and operate — and listed at prices low enough to satisfy today’s tight-fisted lenders.

That’s the bet the Portland-based Piculell Group and its associated builder, Scholls Development, are making at the 34-unit Nottingham Place subdivision in Santa Clara.

“There are builders who are building, and there are homeowners who are buying homes and lots — so (success) is out there,” said Angela Dobrowski, a partner at Scholls Development. “You just have to fit the parameters that banks are looking for.”

The new buyers aren’t so interested in the 2,000- to 2,500-square-foot houses that sold before the late 2007 collapse of the local housing market.

“I may get kicked for saying this,” said Ed McMahon of the Home Builders Association of Lane County, “but the day of the McMansions is rapidly disappearing. When we see what’s going to happen to energy costs, we feel smaller homes — especially for the Baby Boomers — is the next market.”

At the two new houses that Scholls Development is building on speculation at Nottingham Place, that means a tight design without an inch of wasted floor space.

It means stacking washers and driers, tankless hot water heaters up off the floor, storage under the stairs, built-in cabinets throughout and an open great room for maximum flexibility with furniture arrangement.

To catch the eye of wary buyers, developments seek a distinct look. The Piculell Group chose what it calls a “coastal cottage” theme, which includes high-pitched roofs, wide white trim around windows and doors and two or three styles of siding to add interest to the exterior.

The theme is set out in the development’s covenants and overseen by an architectural control committee made up of subdivision residents.

“The cottage look has been very popular in other parts of the Willamette Valley — and up and down the corridor — and Portland certainly,” Dobrowski said. “It’s unique. It’s warm and it’s charming and we’re hoping people will appreciate that.”

Today’s buyer wants green features, as long as they save money in the long run, Dobrowski said.

Scholls is seeking an Earth Advantage gold certification for the first two houses.

But what buyers want most of all is a house that lenders believe they can afford — and that’s a hang-up, McMahon said.

Piculell has priced the two houses at just under $250,000. “Pricing is very important, and $250,000 or below is where you have got to be,” Dobrowski said.

The Piculell Group has a long history of judging the Eugene market correctly — with more than 800 lots sold, built and occupied in the Lane County area.

The company has such a good track record that the Home Builders Association of Lane County is hitching its annual showcase home fundraising effort to Piculell’s gambit by building the showcase house on the lot between the developer’s two spec houses.

This is after the home builders experienced a miserable couple of years with a showcase house that just wouldn’t sell– a 2,208 square foot house with super green features that was originally listed at about $489,000.

Usually, the showcase houses — which are meant to demonstrate the latest and greatest in building trends — sell during or just after the association’s July Tour of homes.

But since the 2008 house didn’t sell, the association didn’t build a show house in 2009.

The association chose to go ahead with a 2010 house only after the sale in January of the 2008 house for $380,000 — more than $100,000 under the original price.

This year, the association is at work on a 1,489-square-foot house with just the practical green features and no solar power generation.

The association advertised the house in April for $224,995 but recently raised the price after a Piculell Group partner produced a market study that showed it should sell for more, McMahon said. It’s now listed at $239,900.

Also, the association recently brought in a real estate agent to help sell the house.

The spring selling season will reveal whether The Piculell Group and the home builders association found the sweet spot in the local housing market.

Hayden Homes, a developer/builder that prospered through the recession by catering to the lower end of the local marketplace, is pricing houses at its new 101-lot Westwinds development in Springfield at $149,990 — except for the first 10 houses which will be listed at $139,990.

Also, houses at a Hayden Homes-related venture, the 38-lot Macintosh Manor in Eugene, are priced as low as $179,000.

The sales are good so far at Nottingham Place, Dobrowski said. Besides the three houses under way, the developer has sold two additional bare lots,

“We’ve been talking to builders for months and months. Everyone is well aware of the development. As soon as the financing loosens up a little bit, we’ll see some more action,” she said.

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