The Everest Newsletter: Residential, November ’18 Edition

 

Realtors say patios are the new ‘special function’ space
How to take the trend straight to the bank

Through every market cycle, homebuyers are always hunting for big savings and even bigger value-add features. Whether it’s a gorgeous farmhouse sink, massive master closet, charming mudroom or spacious home office, each generation has its own set of distinctive trends sure to boost a property’s list (and final sell) price.

But let’s face it: you won’t find a book of ‘best-kept secrets’ sitting at the brokerage. Instead, smart investors must keep abreast of the ever-changing fads and fashions of the day. Luckily, Everest is getting an alpine start on the matter. Let’s dive into the details of one sought-after home feature gaining unexpected traction this quarter.

The nature of profit

While white cabinetry and wide-plank hardwood flooring may be en vogue in 2018, there’s no knowing what homebuyers will be pining for a year, let alone ten years, from now. However, there’s a current trend reported by The American Institute of Architects promising flexibility and longevity—an ideal marriage from an investment perspective.

Seeking to quench their thirst for all things outside, homebuyers are going gaga over backyard patios and similar open-air spaces. Contractors and rehabbers have been scrambling to keep up, pouring fresh concrete and converting existing outdoor spaces into more comfortable, livable areas where people may lounge and entertain.

To illustrate the popularity of the trend, Realtor Magazine notes that about 58.6% of single-family homes that started construction in 2017 featured a patio. We can fully appreciate the pervasiveness of the craze by comparing this stat to similar trends topping the Annual Builder Practices Survey.

Alfresco facts
Single-family new construction, 2017

 

-Patios were the 2nd most popular new home feature just behind porches [64.7%] and ahead of decks [23.8%] 

– Northeast homes integrated patios at a rate of 29%, while America’s Mountain region topped the charts with 80%

– The average size of a new home patio was 260 square feet, which is just enough space for a dining set, lounge area or fire pit

– According to architects, outdoor living space has remained the #1 ‘special function room’ request since 2013

*Stats reported by Architect Magazine and The National Association of Realtors, 2017-2018

From ‘special function’ to ‘staycation’

Throughout the housing downturn of the early 2000s, residential remodels and new construction saw little focus on ‘special function’ spaces. The industry term is used to describe bonus areas of the home where dwellers enjoy space for specific activities, entertainment or other dedicated uses. Years back, lavish extras may have included home movie theaters, formal libraries or indoor pools.

Flash forward a few decades, and homeowners are now opting for practicality over extravagance. Flexibility is key, which is why outdoor patios prove so enticing. Requiring little more than a patch of concrete, pavers or decking, a backyard patio checks multiple boxes—functionality, affordability and adaptability, all while meeting millennials’ increased demand for indoor/outdoor living.

Kermit Baker, Chief Economist at the American Institute of Architects, reminds investors to consider consumers’ top ‘special function’ requests. Over the past few years, survey respondents have consistently reported interest in not only outdoor patios, but also home offices (for telecommuters) and entry mudrooms (with tons of storage).  

Today, poured concrete is the most popular method of patio construction, in addition to natural stone, brick and concrete pavers. No matter which style you seek, invest confidently knowing this special function space is sure to please. Dressed up with a cozy outdoor sofa, pretty all-weather rug, wood-burning chiminea and wrought iron bistro set, a well-appointed patio makes every day at home feel like a vacation.

Everest says: outside investments go beyond curb appeal
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