Hot Housing Trends in a Cold Economy
April 4, 2011
Whether you use tea leaves, tarot cards, a crystal ball or just good old fashioned statistical analysis, the future of the housing market remains murky and the overall economic recovery seems to be missing in action, but one thing is clear. Definite housing trends have emerged and they won’t be going away anytime soon.
Recent trends such as energy efficiency and “going green” are still current and very top of mind for consumers - especially with federal tax credits only available until the end of this year. In addition to these, other, newer trends are also taking root, increasingly borne out of economic necessity but also out of your customers’ desire to stay connected to family or do something good for the environment. It’s becoming more and more apparent that customers want smart HVAC equipment and smart HVAC dealers to facilitate their interest in right-sizing a lifestyle, expressing more individuality, or gaining more control over home energy management.
The tax credit for energy efficiency and other incentives have allowed customers to buy “gold” for the price of “silver” when it comes to heating and cooling equipment. When you consider the energy savings, added home market value, and tax credit, consumers are hard pressed to find another investment with as much payment for both the short-term and long haul.
Here are four of the top housing trends, provided by leading organizations such as the U.S. Census Bureau and the National Association of Home Builders (NAHB) that will be guiding the direction of the HVAC industry and could be helpful for you to know as you work with your existing and possibly new customers:
• Smaller homes – The size of new homes built in the U.S. began shrinking in 2008. New homes are now 7 percent smaller - or the size of one average room - than in the previous year. The U.S. Census Bureau’s qualified projections are for this trend to continue into the foreseeable future. Many people already have HVAC systems that are too large for their homes and end up heating or cooling space that isn’t even there. Matching systems to spaces will be extremely important, and important for you to realize as you meet with your customers.
• Customization – Currently 20 percent of new homes are custom-built. By 2024 the American Institute of Architects (AIA) predicts more than 50 percent will be built to custom specifications. HVAC companies with smart/digital technology and a portfolio of high-performance, high-quality products, great service, and certified technicians will be in demand. Trane, along with its sister company Schlage, is offering customers some of the most advanced home automation systems available today. For example, through the Schlage LiNK™ online web and mobile interfaces, your customer’s home is always within reach. The powerful, Z-Wave® enabled Schlage devices allow for the customization of the solution for customer lifestyle needs. In 2011, you can expect to see home energy management taken to a new level with breakthrough technology being introduced by Trane. In fact, it seems almost unfair to compare standard thermostats to Trane’s new ComfortLink™ II Thermostat.
• Multi-generational homes – One-third of boomers report children 18+ live with them or will probably move back home at some point, and 8 percent report that their parents are now living with them or will in the future. In a recent 12-month period, 37 percent of Coldwell Banker Real Estate professionals report more families are looking for homes that can accommodate multiple generations. With more people living under one roof, expert preventive maintenance, tune-ups, and air quality equipment will be needed to ensure a healthier, cleaner home. Look for ways to provide your customers with options that will help make their living environments more comfortable, such as a whole-house cleaner that removes up to 99.98 percent of all the particles and allergens from the filtered air.
• Aging in place – Adapting our living environment for aging in place involves home modifications that can make it safer, more comfortable, and increase the likelihood of remaining independent. Smart products and systems will make it easier for seniors to live at home. For example, Trane’s ComfortLink II communicating system, in which components talk to each other, can make things less complicated and home energy management easier. That way, they’re always automatically configured and calibrated to the owner’s preferred settings, and constantly troubleshooting to achieve utmost efficiency year after year. The system is so smart it will call customers and their HVAC dealer with system alerts.
Of course, there are other things out there influencing HVAC decisions and housing trends. According to the NAHB, there are four key influencing factors:
1. With economic uncertainty, people don’t feel comfortable spending as much today.
2. High energy costs for heating, cooling, and electricity, but also the impact of those costs on construction materials.
3. Aging boomers: the empty-nester segment is rapidly downsizing.
4. Tight credit continues to make jumbo loans more difficult to secure.
So, what can you do to help ease customer uncertainty? Stop trying to sell consumers technology. They want us to provide solutions that will keep their children and families healthy, comfortable, and safe. They want peace of mind. They want products and systems that fit their lifestyle that are easy to operate, easy to purchase, and easy to live with. They don’t want to make multiple phone calls and juggle multiple contractors to get what they need - they want simplicity. They want dependability. They want ease. That’s what buys them more time to live their lives - and that’s what we should be offering them.
In this uncertain economy, and as demographics change and consumers get smarter about HVAC performance, connectivity, and integrated products, successful HVAC professionals will have to be nimble, knowledgeable, and creative to meet these changing demands. As a leader in the HVAC industry, Trane is committed to providing its dealers with solutions that address customer concerns and demands. Each of us in the industry needs to be a trusted adviser in everything that matters to customers today - comfort, energy efficiency, lower utility bills, healthy and clean indoor environments. It’s no longer about the box. It’s not about the furnace or the air conditioner. It’s all about delivering a better quality of life in the midst of continuing housing trends and customer needs.
Publication date: 04/04/2011