New-Home Outlook and Consumer Perception: Insights from the 2024 International Builders' Show

The 2024 International Builders' Show provided critical insights into the future of new home construction and consumer perceptions in the housing market. With an optimistic forecast and valuable consumer data, the event highlighted key trends and strategies for both agents and builder representatives.

Positive Outlook for New Home Construction

The National Association of Home Builders (NAHB) presented an encouraging forecast for the single-family home construction industry. In 2024, the industry is expected to see a 4.7% increase in new-home construction, reaching 988,000 units. This growth is projected to continue into 2025, with a 4.2% rise, bringing the total to 1.03 million units. These figures suggest a robust market driven by strong demand and favorable economic conditions.

Understanding Consumer Perception: Agents vs. Builders

A crucial part of the home-buying journey involves navigating the roles of agents and builder representatives. The 2024 New Construction Consumer Report (Down Load Link), conducted by Realtor.com, sheds light on how home buyers perceive the benefits of working with agents versus builder representatives.

1. Decision-Making Assistance

52% of buyers found agents instrumental in their decision-making process, while only 30% felt the same about builder representatives. This difference highlights the significant role agents play in offering expertise and personalized advice.

2. Awareness of Process Requirements

Agents excelled at informing buyers about essential aspects they might have overlooked. 49% of buyers felt agents provided crucial information about the home-buying process, compared to 33% for builder representatives. This statistic underscores the agent's role in educating buyers, ensuring they are fully prepared for the complexities of purchasing a new home.

3. Best Interests at Heart

Trust is a key factor in any transaction. 49% of buyers believed agents had their best interests at heart, compared to 29% for builder representatives. This gap suggests agents are more successful in building trust and rapport, providing a sense of security and confidence throughout the buying journey.

4. Communication and Information Sharing

Effective communication is critical for a smooth transaction. 48% of buyers felt well-informed by their agents, while only 33% felt similarly about builder representatives. Agents appear to be more proactive in keeping clients informed.

5. Educating on the Home Buying Process

46% of buyers reported that agents educated them on the process of purchasing a newly built home, while only 35% felt builder representatives provided this guidance. This highlights the agent’s role as an educator, ensuring buyers understand each step from initial considerations to final decisions.

6. Knowledge of Property

Interestingly, the gap narrows when it comes to knowledge about the property itself. 42% of buyers considered agents the most knowledgeable, while 40% thought the same of builder representatives. This suggests that while agents excel in broader guidance, builder representatives possess valuable specific knowledge about the properties they are selling.

Best Practices for Agents and Builder Representatives

To better serve their clients, both agents and builder representatives can adopt several best practices:

Offer Comparables

Providing comparables is crucial for buyers. For example, one buyer chose a newly built townhouse with over $50,000 in upgrades, making it one of the most expensive in the neighborhood. By reviewing comparable sales, the buyer determined the extent of necessary upgrades. Offering comparables helps buyers make informed decisions and avoid over- or under-investment in upgrades.

Work as a Team

Collaboration between agents, builder representatives, and buyers is essential. Setting clear expectations regarding construction processes, timelines, and communication methods ensures everyone is aligned. This approach fosters a cohesive team dynamic, enhancing the overall experience for buyers.

Document Everything

In new-home construction, documentation is key. For instance, one builder mistakenly installed the wrong kitchen cabinet handles—gold instead of the requested silver—resulting in additional costs and delays. Documenting every detail helps prevent such errors and ensures the buyer's vision is accurately realized.

Stay Committed

A strong commitment to clients extends beyond the initial sale. One notable example involved a buyer who asked the builder representative to officiate their wedding as they were tearing down the existing home and building anew. This anecdote underscores the importance of long-term commitment and building deep relationships.

Conclusion

The 2024 International Builders' Show offered valuable insights into the housing market's future and consumer perceptions of agents and builder representatives. As the industry continues to grow, understanding these dynamics will be crucial for professionals in the field. By offering comprehensive guidance, effective communication, and unwavering commitment, agents and builder representatives can better serve their clients, ensuring a positive and informed home-buying experience.