Higher Ceilings
Records Set Again The nation's builders achieved housing starts of 1.953 million in 2004, a new annual mark and almost 6% higher than in 2003. A record 1.183 million new single-family homes were sold in 2004, up nearly 9% over the prior year. Low mortgage interest rates and employment and personal income gains have made homes highly affordable to a wide range of demographic groups.
Remodeling Also Enjoys Growth Increased homeownership eventually leads to greater spending on remodeling. The number of homeowners who performed home- improvement projects has grown by nearly 20% since 2001. From 1995 to 2003, U.S. spending on home improvements rose 52% to $233 billion.
High up the Ladder Thanks to the housing boom, the nation's top building companies reported spectacular financial results. Six of the country's top 10 builders registered revenue increases of 20% and more in 2004. Overall, the top 10 closed nearly 449,000 homes and enlarged their market share to nearly 36% in 2004.
Overview of Home Buyers The key element in consumer demand for housing is the American dream of owning one's home, which is shared by all demographic groups. Minorities as a share of new-home buyers doubled over the past decade; they also represent 35% of all first-time home buyers.
A Look at Remodeling Customers One out of 10 homeowners remodeled some area of their house in the 12 months ended in September 2005. Homeowners in their 30s and 40s led the home-remodeling market in 2004. Home-improvement spending by young adults jumped by more than fivefold from 1995 to 2003. Home-improvement spending also rose among foreign-born households and ethnic minorities, with Hispanic Americans led the way.
Why Homeowners Remodel The reason for most home-remodeling efforts today is homeowners' desire to increase the value of their houses. The money a homeowner puts into his/her house today will pay off down the road when the home is sold. Many homeowners are willing to contract for expensive remodeling projects, and to borrow off their home equity to pay for these projects.
The Impact of Luxury Homes Luxury-home features such as higher ceilings, walk-in closets and two- and even three-car garages have become standards on many homes. Flex spaces rooms that can be tailored to serve as extra bedrooms, playrooms, home offices, studios and fitness rooms are also popular today. Bringing the outdoors inside through al-fresco rooms and spaces is another design feature much in demand.
Other Home- design Trends The latest trend in kitchen layouts is the creation of multiple work zones for cooking and non-cooking activities, and appliances. Storage in the form of larger garages, closets and pantries has become a key home feature. Some homes now have "aging in place" layouts, including fewer steps, wider doorways and lower kitchen cabinets with drawers.
A Record Pace… Then a Slowdown The monthly statistics point to 2005 being the fifth consecutive year of records in home sales and housing starts. Many economists believe that housing will cool off as home prices and interest rates rise in the years ahead. Rising prices should boost home improvement because they create additional equity, which homeowners can use to finance remodels. The nation's largest builders will continue to grow in the coming down cycle by acquiring medium-size companies.
Promising Customers for the Future Minorities, whose numbers will increase rapidly, will drive most of the growth in the construction industry down the road. The aging U.S. population will also have a strong impact as retirees seek smaller homes designed for their needs and vacation houses. Echo boomers are turning 21 years old at the rate of 4 million a year; the older adults in this group will soon be ready to shop for homes.
Advertising Strategies As local businesses in a tough and highly competitive market, builders and home- improvement contractors need marketing and advertising that provides the greatest impact. This is why television, which presents the most creative and dynamic advertising of any media, is an absolute essential to their marketing campaigns. The major advantage TV has over other media, its unequaled combination of sight and sound, goes straight to the bone for builders and remodeling contractors. The powerful images in a commercial meld with the audio messages to produce advertising that ensures that these businesses will move ahead of their local competition.
Advertising Strategies Homeownership is a dream of all American consumers and advertising for builders must focus on the dream of owning a highly styled new home. Because of its use of striking images, television is the ideal medium for selling all products and services based on dreams. The same is true for home-improvement contractors, who create interior spaces that meet the needs and desires of homeowners. Comfortable, well-designed rooms are part of the dream of homeownership, and TV is the one medium that can convey dream-oriented advertising to its greatest effect.
The answer is three simple reasons! Why TV? The answer is three simple reasons!
Why TV? 1. Your customers and potential customers use it — viewing daily for long periods of time 2. TV’s attributes of sight, sound, motion and emotion let you best communicate your message to these people 3. Television works in dollars returned!
Remember, Only television can give you: Why TV? Remember, Only television can give you: The right message To the right people At the right time In the right place!
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