Last week I mentioned that new home sales jumped 18.7 percent year-over-year, which is a ten-year high. It should come as no surprise that new homes are selling like hotcakes. After all, existing home inventory has been and remains historically low, which doesn’t give many options to home buyers. But there are other reasons for the allure of new construction. Some of the home buyers’ motives are apparent and some are not so obvious.
The idea of buying new construction goes beyond the “new home feel.” Buyers of new homes are attracted to modern designs and trends that are incorporated into new houses. New home construction takes advantage of modern building techniques and materials that allow for the open floor-plan concept that many home buyers prefer. Many of the materials used in new construction are “engineered” for efficiency and longevity.
Buyers of new homes like the feeling that there will be minimal maintenance for the first year. Everything is brand new and there is sense of confidence that the home’s systems won’t need major repairs or replacement. Being the first owner of a home also gives assurance that they won’t have to deal with the poor maintenance habits of the previous owner. This is a plus for home buyers who don’t have a lot of financial reserves to address home maintenance emergencies. Instead, they can begin to save and budget for future repairs and replacements that should be years down the road.
New home builders take advantage of current trends in green building practices. Many new home builders tout their LEED certification, demonstrating their commitment to energy efficiency and sustainable resources. Green building practices are not only used when the home is built, but is actually built into the design. Home owners seeking LEED certified builders believe they will have a smaller impact on the environment and save money on energy costs.
A new trend that buyers are pursuing is the “healthy home.” The healthy home concept emphasizes the quality of the air inside the home. Home buyers are becoming aware of the physical and environmental benefits of good indoor air quality, which can improve their emotional well-being and reduce the potential for respiratory distress.
But there is another reason why home buyers are attracted to new homes, and it lies within the brain. Research has demonstrated time and again that consumers respond to novelty. This means that home buyers have a tendency to want “new.” This can be interpreted into making an old home new by renovating a kitchen, bathroom, etc. Or it can mean buying a newly built home.
The novelty seeking behavior of the home buyer isn’t just a choice, as some may argue, it’s neurological. Basically, the desire for a new home lies within the brain. A study conducted by Nico Bunzeck and Emrah Düzel (Absolute Coding of Stimulus Novelty in the Human Substantia Nigra/VTA; 2006; Neuron 51, 369-379) demonstrated that the hippocampal region of the brain responds to novel (new) stimuli. The hippocampal region is part of the limbic system, which is noted for being responsible for memory and emotions. It has also been associated with motivation.
The study also discusses the idea that novelty seeking behavior isn’t just emotional, but it is also rewarding. This means that there is a behavioral loop for seeking new things, including buying a new home.
Home sellers need to take note of these findings. Translating this study to home buyers may mean that a home’s feeling of “newness” is important, regardless if it’s construction, renovation, or even how the home is decorated. Understanding what attracts and motivates home buyers can be the tipping point to get a home sold.
Copyright© Dan Krell
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