Energy costs, recession drive demand for smaller homes, less volume

Washington, D.C. – June 29, 2008 – Due to the economic recession and a renewed interest in lowering utility costs, there has been a growing demand for smaller sized homes in recent years. There has also been an adjustment in the volume of living space with a preference for lower ceilings and a diminished interest in two-story foyers. Property upgrades, however, are extremely popular with households trying to maximize their usable space with finished attics and basements, outdoor living enhancements and blended indoor / outdoor features. Accessibility within the home continues to be a concern, especially for an aging U.S. population. Business conditions for residential architects remain weak, but appear to be stabilizing with the first uptick in billings since the second quarter of 2007. These findings are from the American Institute of Architects (AIA) Home Design Trends Survey that focused specifically on overall home layout and use in the first quarter of 2009.

“The era of the ‘McMansion’ could well be over as home sizes have been trending downward recently, with a significantly higher number of architects reporting demand for smaller homes this year,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “And as the housing boom has passed there seems to be a renewed interest in investing in properties to make homes more livable, as opposed to real estate that can be resold quickly for a profit.”

“Adding decks, porches and patios are all part of the outdoor living enhancement trend,” added Baker. “But that also extends to more formal outdoor ‘rooms,’ cooking areas and blended indoor / outdoor features.”

Housing market business conditions
AIA Home Design Survey Index for Q1 2009 (any score above 50 is positive)

  • Billings: 24
  • Inquiries for new projects: 35

Baker continued, “Business conditions at residential architecture firms really began to deteriorate in the middle of 2008. While still very weak, we are beginning to see a slight reversal in home design and improvement activity. ”

Specific residential segments (index score computed as % of respondents reporting improving minus % weakening conditions)

  • Kitchen and bath remodeling: 28
  • Additions / alterations: 26
  • First-time buyer / affordable home market: -27
  • Move-up home market: -44
  • Townhouse / condo market: -51
  • Custom / luxury home market: -52
  • Second / vacation home market: -77

About the AIA Home Design Trends Survey
The AIA Home Design Trend Survey is conducted quarterly with a panel of 500 architecture firms that concentrate their practice in the residential sector. Residential architects are design leaders in shaping how homes function, look, and integrate into communities and this survey helps to identify emerging trends in the housing marketplace. Business conditions are also monitored on a quarterly basis. Future surveys will focus on specialty rooms and systems (September 2009) and community design trends (December 2009).

About The American Institute of Architects
For over 150 years, members of the American Institute of Architects have worked with each other and their communities to create more valuable, healthy, secure, and sustainable buildings and cityscapes. By using sustainable design practices, materials, and techniques, AIA architects are uniquely poised to provide the leadership and guidance needed to provide solutions to address climate change. AIA architects walk the walk on sustainable design. Visit WalkTheWalk.

Overall home layout and size trends

Residential elements
(% of respondents that reported increases)

2009

2008

In-home accessibility

63%

67%

Open space layout

50%

53%

Access into / out of home

49%

59%

Informal space

45%

61%

Finished basement / attic

32%

46%

Single-floor plan

34%

40%

Home volume

11%

28%

Square footage

4%

16%

Lot size

2%

7%

Table 2

Outdoor living and landscaping trends

2008

2007

Low maintenance landscaping

67%

70%

Outdoor living space

60%

67%

Blended indoor / outdoor living

51%

55%

Exterior / security lighting

33%

39%

Outdoor amenities

22%

31%

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