Last month, the U.S. Census Bureau released the first batch of the freshly collected 2010 census data of the nation. The big news so far: The official resident population count increased 9.7 percent over the 2000 census to 308.74 million people (the slowest growth rate since the Great Depression), with most growth occurring in the South and West regions, led by Texas.
It’ll most likely take months, if not years, before demographic trends that are specific and relevant to the housing market are released, so we thought this would be a perfect moment to conduct our own census of the custom-home building market.
Custom Builder Contributing Editor Susan Bady provides an extensive recap of our December 2010 demographic and market trends research study on the custom market. Our exclusive survey of Custom Builder readers covers everything from the number of custom homes built annually to trends in spaces, amenities, and client budgets.
One surprising finding: A decent portion of custom builders are serving clients that are in a somewhat younger age group than what is typically expected for this market. Twenty-eight percent of survey respondents said their typical client is 35 to 45 years old, and less than one percent of builders cater to clients over the age of 65. Most builders provide move-up housing (79 percent of respondents cater to the primary residence, move-up buyer), but about a third said they also build retirement housing, which indicates that custom-home buyers tend to retire (or at least plan their retirement housing) before the age of 65.
Not surprisingly, most builders report a slowdown in activity. About one-third said they are building one to four fewer homes compared to three years ago, and 25 percent said their output is down by five to 19 homes. The vast majority of respondents build between one and seven custom homes a year.
Likewise, client budgets have also been affected by the economy. More than 60 percent of survey respondents said their clients’ budgets are lower today than they were three years ago. Nearly one-third of builders said budgets are significantly lower, more than 5 percent. As custom builder Rick Gross of Estes Builders puts it: “Budgets are smaller now than they have been historically. People want more for the dollars they’re spending; they expect a deal. That’s just normal.”
Check out our special report, and feel free to drop me a line with your feedback.