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Real Estate Trends Impacting Design

Designers should be aware of real estate trends that impact resale, and be sure to keep clients abreast of these, particularly if the home is an investment property or one the clients don’t intent to live in long term.

authors Jamie Gold 

How often do the architects, designers and contractors reading this have a resale-related conversation with a client? Is it with the homeowner who wants to upgrade the high-end production home she bought a decade and a half ago? Or is it the client building a custom home who thinks he’ll spend the rest of his life there, but you know from experience that “life happens,” and quick sales are sometimes needed?

Have you warned a client away from purple concrete countertops or a Coca Cola-themed backsplash because they might impact the value of the home in future sales? Personalization is wonderful, but how far should it go? Part of a design or building professional’s role is guiding clients on what makes sense for their lives, their properties and their investments. Manufacturers already get this; they produce and market what they believe will sell the most units for the most homes through the most channels. The niche and exotic offerings are usually custom orders.

Accessory dwelling units – separate or within the home’s envelope – are growing in popularity.
Photo: Lennar

If you’re interested in what’s trending in the real estate market right now – especially if your clients are investors – these pros can fill you in:

  • Steve Moses, home services manager for national real estate firm Redfin;
  • Stephen Wagner, president of the Appraisal Institute professional association;
  • Janice Spousta-Hinshaw, regional v.p. overseeing the company’s interior design teams with national homebuilder Lennar;
  • Henry Moseley, managing director with luxury mixed-use design and development company Adept Architecture.

This will be a two-part series, with overall trends and kitchens featured this month and bathrooms and technology to be featured in the October issue.

Overall trends

The real estate market is still strong for home builders and sellers, and is predicted to stay that way for the foreseeable future. That’s good news for your clients who own their own houses or condos, which continue to increase in value, especially in the hottest markets.

Millennials are a growing segment of buyers, so their interests should definitely be factored in, especially at the starter-home level. Technology and wellness are strong considerations for this massive generation. Baby boomers are the largest segment still, and as they move into their 60s and beyond, they’re looking for homes with accessibility. (That can mean valuable upsells in the kitchen, especially, for interior organization features that make bending and kneeling obsolete.) Keep an eye out for Gen Z buyers in the next few years – and coverage of them in this space! They’re the youngest home-buyer generation, still in their early and mid-20s.

Another real estate trend that’s growing in many markets, especially those with severe housing shortages, is the accessory dwelling unit – a.k.a. the granny flat. “California is big on ADUs and multi-generational living right now,” observes Redfin’s Moses. “Having these available on a single level with possibly a separate entrance is a huge selling point. Having a sink, fridge, microwave and washer/dryer in an ADU or in-law suite are value-added gold,” he declares. A cooking surface like a hot plate or induction burner are also desirable for these units.

On the other hand, major upscale kitchen remodels are recouping 20 percent less than minor projects, notes the Appraisal Institute’s Wagner, though they can be “worthwhile simply because they do improve the owners’ quality of life.” A minor kitchen remodel is showing the highest return of any kitchen job, he observes. It can also be a quick, easy lift for a professional, encompassing refacing, new hardware, new energy-efficient appliances, countertops, sink and faucet and resilient flooring, as well as new paint and trim, without the complexities of construction.

White is still the most popular color choice for kitchen designs.
Photo: Redfin

“In general, buyers are looking for a clean look, with a focus on storage,” observes Lennar’s Spousta-Hinshaw. “They want large, open gathering spaces – usable spaces. Formal spaces aren’t as necessary or desirable.” Whenever possible, those indoor gathering spaces should connect to the outdoors, even for smaller condos and townhouses, she adds.

Adept’s Moseley is seeing sleek and contemporary in his high-end Pasadena units. “Luxury buyers are wanting more contemporary designs with clean lines, stone finishes and a sleek feel, however they are not willing to sacrifice on durability and performance,” he notes.

Kitchen style

Moses’ job at the real estate company’s RedfinNow division is to oversee renovations on homes for resale. He’s also in the high-priced Los Angeles market, giving him a unique insight on what features add the most money, insights that could be valuable to your homeowners, too. “I feel that modern and transitional styles drive the kitchen market and help homes sell faster,” he shares. “I am also seeing a lot of floating shelves vs. upper cabinets, allowing designers to make a statement wall out of a backsplash to jazz up a smaller space.”

When it comes to color in his market, the answer is simple, Moses says: “White, white and more white. Shaker-style cabinets still rule, but some ready-to-assemble importers are coming up with really amazing contemporary options that have matte, textured flat and glossy finishes that are gaining steam.” Appliances in stainless are still popular, he comments, but some design-forward homeowners are asking for matte black or matte white with gold accents.

Lennar’s Spousta-Hinshaw says, “We monitor very closely what buyers want so we can offer those features affordably. What we see is a strong desire for quartz countertops, large pendant lighting, white cabinets, lighter-colored granite and darker cabinets with gray undertones versus warmer red tones.” Organization features are very popular, she notes. “We include built-in trash receptacles, walk-in pantries, countertop USB outlets and pull-out drawers for pots and pans.”

Moseley agrees: “To optimize maximum space, we include magic corners and full-height, walk-in pantries in order to keep everything within arm’s reach.” The appliances in his project are largely paneled. Quartz is the top countertop choice for Adept’s luxury buyers, too, even those offered with full custom options. “A handful of penthouse buyers also requested a second enclosed kitchen with a stronger vent system that was located away from the show kitchen and open living space. For those buyers, we added a small cooking area with stove, hood and cabinetry in place of the walk-in pantry.” That’s another great upsell opportunity for clients who love to entertain and have generous budgets.

Islands are expanding in Lennar homes, the builder reports, citing “larger kitchen islands, because the kitchen is still the heart of the home and large islands allow family and friends to gather together.” These islands are often topped in quartz, like the rest of the kitchen.

Today’s indoor living spaces should be designed connect to outdoor areas.
Photo: Lennar

“Quartz has become the go-to surface,” Moses observes. “The visuals and quality have improved over the years and have replaced granite in many markets. For the kitchen sink, deep, single-bowl sinks with either a granite composite or fireclay undermount or front apron are a huge selling point.”

What are some mistakes to avoid when thinking about resale? Moses warns about “over-improving a kitchen with either designer brand tile, counters or appliances.” Wagner concurs; just because homeowners spend the money doesn’t mean they’ll ever see a return.

Moses also cautions against designing a kitchen that only one homeowner likes, though every designer can probably recall a client like this! For example, he says, “This is region specific, but in Los Angeles everyone wants white cabinets, so if you freshly do a kitchen with an oak clear coat finish, that would negatively impact the value and how quickly the home sells.”

Last words

“Kitchen improvements often drive a buyer’s decision on the purchase and how much they will pay,” Wagner says. “High-end appliances and good lighting are features buyers demand. Value is market driven, and while these features are desired, how much they add depends on the market area.” That’s a good conversation to have with your clients at every price point. ▪

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