Smaller Households Fuel ‘Jewel-Box Homes’ Trend

December 17, 2019 by brentleathwood

More than 50% of U.S. households today have no more than two people – and many now want a smaller home – but one with upscale amenities and expensive finishes.
NEW YORK – Jewel-box homes – small properties packed with amenities and costly finishes – are seeing higher demand as more than half of all households now consist of single people or couples, according to U.S. Census data.

An analysis by Home Innovation Research Labs, a subsidiary of the National Association of Home Builders, showed a nearly 20% jump in the number of new-construction luxury homes at 3,000 square feet or less since 2013 – an increase accompanied by a decline in larger-size, high-price homes.

“Empty-nesters want to downsize, but they want luxury homes, not starter homes – luxury kitchens, marble surfaces, all the latest and greatest,” says Builder Homesite CEO Tim Costello. Meanwhile, many younger homebuyers don’t want to deal with the cost and headaches of maintaining a large house.

However, it can still be difficult to find new-construction homes that fit the jewel-box profile, but more builders are catching on and starting to offer them.

Source: Wall Street Journal (12/11/19) Gamerman, Amy

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3 Big Mistakes Buyers make:

1. NOT KNOWING THE NEIGHBORHOOD...ContinuedReal estate always has been and always will be a local business. Know your neighborhood is a cardinal rule in this business. A real estate professional knows what is going on in their local market area. Hire a knowledge, local professional. When we see folks wandering around with a notebook and a list of questions, we know they are the most likely to make a costly mistake. A PROFESSIONAL Realtor, (please note the word professional), can spend 15 minutes listening to your needs and wants, and probably rule out 90% of the local market options, and focus your attention, on the 3 or 4 or 5 communities that will meet your needs, and make sense from both a financial and lifestyle point of view. I am amazed at how many people from out of State, go it alone, end up buying in the wrong community, and come to regret it. I meet people like this everyday, and everyone single one of them will say to me: “I wish we had met you first.”
2. GETTING STUCK IN AN HOA NIGHTMARE...ContinuedHome owners association nightmares are the stuff of legend in our State. Do not buy the wrong property in the wrong community. A knowledgeable real estate professional can explain to you upfront, the ins and outs of the HOA regulations of the community you are considering, and help you avoid 99% of these potential pitfalls. This is another very costly mistake.
3. THINKING YOU DO NOT NEED A REALTOR WHEN BUYING A NEW HOME...ContinuedEverybody knows you need a Realtor to represent you, when buying a resale home. Many do not know, you also need a Realtor to represent you, when buying a new home. The new home sales person in the model home works for the Builder, not the Buyer. They are paid to look out for their employer’s interests, not yours. You will not save $1 by going it alone. You will lose money. A lot of money. One of our largest local builders reported 872 annual sales, of which, 762 were handled by Realtors representing the Buyer. That is 87% of the total. The Builder has already factored paying a finder’s fee into the price. The Builder will not rebate $1 of this money back to you. Builders laugh under their breath, when Buyers try this negotiating tactic, even though they will politely agree with you. Professional representation costs you $0, why would you fend for yourself, in a market you know almost nothing about? Buyers know less than 20% of what they actually need to know, to get a great deal. Having gone through the new home buying process hundreds of times with clients, we know all the pitfalls to avoid, and how to make the process go smoothly. Do not go it alone, get professional representation, it costs you $0. Not doing this is the most costly of the 3 mistakes. But everyone has heard the old saying, you can lead a horse to water. We are in the business of helping our customers solve a problem. Our ability to do that, is the sole reason we have a thriving business. We are here to help you through the entire process, and get a great deal.

4 Big Mistakes Investors make:

INCOME... ContinuedThe rental income does not justify the $/sq. ft. purchase price.
EXPENSES... Continued The monthly expenses are too high, relative to the property type and rental income produced.
CAP RATE... Continued The capitalization rate is too low to justify the investment.
HOA REGS... Continued The home owners association regulations are too restrictive, or do not permit the intended use. Frequently overlooked or glossed over by some sales people, the long run financial consequences are catastrophic if a mismatch occurs.

Avoid Costly $$$ Mistakes: Hire Brent. Costs you $0.