The Daily Gazette – Hot on the local building scene: energy efficiency

by John Cropley for the Daily Gazette | March 24, 2016

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Photo by Erica Miller

CAPITAL REGION — Construction and sales of new houses are in full swing in the Capital Region.

Thanks to mild weather, builders were able to keep building through winter, when they normally must slow down. Mortgage rates remain near historic lows, making a newly built house a little more affordable. Older residents are opting for smaller houses with fewer stairs, while young professionals are looking for space to accommodate growing families — and both are attracted to the idea of a new house that doesn’t need the upkeep of an older structure.

Pam Krison, executive officer of the Capital Region Builders and Remodelers Association, said her members are seeing a lot of interest from potential buyers.

“We’re definitely hearing and seeing the same thing,” she said. “I was at the Home Expo and I saw a stronger interest in the custom homes, that was a common question. The winter weather really helped this year.”

New home construction can range from production houses — those built alike in a cluster, or an entire development — to custom houses, which are built one at a time to the customer’s specification. The cost to build a 2,500-square-foot house can vary hugely, mainly due to the size and location of the lot and the grade of components that go into the house, but typically, production houses are less expensive and custom houses are more expensive, or much more expensive.

The very flexible (and popular) middle ground is the semicustom house, where a builder starts with a plan that the buyer can modify and a list of components that the buyer can upgrade or downgrade based on individual need and taste.

Krison said the traditional points of customization, such as the kitchen, remain popular, but a growing trend is not a particular object or design, it’s a concept: energy efficiency.

“People can go from zero to a hundred on that,” she said. “Your utility bills are for the rest of your life. There’s been such an awareness of that.”

Another trend, which is related to energy efficiency, is lighting. Builders and buyers are paying more attention to the source and amount of light in a new house.

“Lighting is getting a lot of focus. Not just light fixtures, but bringing natural light in,” Krison said. Leading the way on artificial light are the rapidly multiplying options for using LED lights, which cost more to buy but last longer and use less electricity than other light bulbs.

Great rooms — large spaces that unify living, dining and cooking areas — remain an attractive feature, she said.

“Open space is extremely popular. Formal dining rooms and living rooms are a thing of the past.”

The average new house sizes aren’t changing greatly, Krison said, aside from those built specifically for retirees who want to do less cleaning and maintenance.

Rather, the square footage is allocated differently in the design phase.

DOWNSIZING, SORT OF

John Witt, a custom builder for nearly 30 years in Saratoga County, said downsizing means different things to different people. What it results in is often a smaller number of larger rooms, with little net reduction in the square footage.

The exception, he said, is in the city of Saratoga Springs, where building lots are small, scarce and expensive, limiting what can be built there, particularly at a lower price point.

Witt is gearing up to build an 18-unit townhouse project in the city and trying hard to keep the entry-level price under $300,000. To do this, he’s limiting square footage but tweaking the design to create the illusion of greater size, such as with maximum open space and extensive use of glass.

Witt is seeing a lot of activity in the new-construction segment now. “Interest rates are still very low, very reasonable,” he said. “People who have been sitting on the fence I think are deciding to purchase.”

He sees two very specific demographics interested in buying his properties: About two-thirds are empty-nesters and most of the remainder are young families. The younger couples are “usually looking for an open floor plan with the majority of the bedrooms upstairs,” he said. The older couples want single-floor living. “That’s tough when you’re building in the city … they’re small lots.”

“We’re doing a house with an elevator now,” Witt said.

His advice to clients is to get what they want, not what they think a house should have.

“Over the years we’ve gotten rid of the formal dining room, the formal living room,” he said. The bathroom is another good place to make these changes — he doesn’t install many tubs in the master bathroom these days.

“Ninety-five percent of the clients don’t take a bath, period,” Witt said. “Take the money out of the tub and put it into something you’ll use.

“Ninety percent of them take my advice,” he added.

DETAILS MATTER

Another Saratoga County company, Belmonte Builders, sees a very similar trend: Young professionals upsizing and empty-nesters downsizing.

Director of marketing Mickey Ricciardi said Belmonte tailored one of its communities, The Mill at Smith Bridge, to capture both demographics. There are bigger traditional houses and smaller houses with low- or no-maintenance agreements, residents of which don’t have to plow snow or mow grass.

The two age demographics are happily mixed together there, he said, “which used to be rare.”

“We’re outpacing the sales rate we thought we’d have, due to those two marketplaces.”

To capture its share of the booming Saratoga County housing market Belmonte tries to balance features and value.

“We’re very busy in the $400,000 to $500,000 range,” Ricciardi said.

“We’re building more feature-rich homes than we were building ten years ago, perhaps a little smaller in square feet. A lot of people are very price-per-square-foot conscious.”

He said the company has found that useful or interesting features help sell the house as much as size. “We’ve found we can make the home a little smaller as long as there’s a surprise around the corner.”

One example is rooted in an earlier era: the butler’s pantry, a foyer between the kitchen and living/dining area where food-serving and -eating accessories are stored.

“It’s kind of an anomaly for this age,” Ricciardi said. “We put a few in some model homes, everybody loved them, so we’re doing a lot of them now.”

Screened porches have proved popular, too.

“That could be a function of Saratoga County, it’s very buggy.”

The CUSTOM BUILDER

Bella Home Builders is a custom builder currently working on subdivisions and custom houses in Saratoga, Wilton, Malta and Guilderland that run anywhere from $500,000 to $2.5 million.

Founder Dave DePaulo said he’s busy now, but never really saw a slowdown.

“We’ve always been busy, now we’re really busy,” he said.

As for the surge he and the new-housing industry as a whole are seeing, he said, “Interest rates have a lot to do with it.”

Above and beyond that, there are special circumstances in the region where Bella does a lot of its work:

“Saratoga County is very popular,” DePaulo said. “It’s a gem. It has a lot to offer.”

And it continues to draw residents from other counties, fueling the housing market there.

What’s popular with Bella’s customers right now? Many of the same features other builders cite.

“Our clients want high-line appliances, custom kitchens,” DePaulo said.

In the case of older clients, smaller and simpler is popular. In their case, that’s still a fairly good-sized house, 2,400 to 2,800 square feet, but the details are fairly universal, regardless of price and size:

“The older people that are empty-nesters are looking for a first-floor master, a smaller plan,” he said.

Bella has local architects it works with to create a plan that matches the buyer’s wants and needs.

“A lot of the stuff I do is right from the beginning, start from scratch,” DePaulo said.

THE SEMI-CUSTOM BUILDER

One of the most active builders in the Capital Region is Guilderland-based Amedore Homes. It starts with a particular group of house designs, but gives extensive options for changing the details and components within the plan, limited in some cases only by the future owner’s wallet and imagination.

Walls can even be relocated, provided the architectural integrity of the original plan is maintained, Chief Financial Officer Paul Amedore said.

It’s shaping up to be a strong year for the company.

“We are in eight different communities in three different counties,” he said. “We have sales trending upwards in all three counties.

“The demographics are pretty robust across the spectrum for the projects we do.”

Asked what option is most popular, Amedore said maintenance-free living is huge.

Asked what feature is the most popular target for customization, he pointed to the busiest room in most people’s home: the kitchen, particularly the counter tops, tile and appliances, which offer a massive range of options.

Customers need only stay within their budget, he said: “There’s always tradeoffs with every decision.”

Amedore credits low mortgage rates in part for his company’s surge in business.

“Interest rates, every time there’s a rise, you see things cool off for a short time,” he said. “There’s a knee-jerk reaction, then things pick back up.”

The other factor Amedore sees, like so many other builders, is the empty-nesters seeking to downsize.

“That demographic is doing pretty well for us.”

THE OUTLOOK

Matt McPadden of McPadden Builders said he expects demand to continue to great or lesser degree into the near future.

He has firsthand experience with the housing industry through trying times, having first gone into business framing other builders’ houses in 2002, during the post-9/11 economic slump. He started as a builder himself in 2006, as the housing bubble was about to burst and kick off The Great Recession.

He said he kept going through all that by doing good work on time, thanks in part to picking good subcontractors and sticking with them.

“We pride ourselves on sticking to a schedule,” he said. “We put together a great team.”

The next demonstration of this will be the model house McPadden Builders constructs for its new project, Wyndam Way, an eight lot subdivision in Milton. It’s bare ground now, not even excavated, but in less than six months a showcase home will stand there. He expects to build 15 to 20 others this year.

The houses McPadden builds are generally higher than entry-level but they aren’t huge or hugely expensive. The model house at the Craw Farm development in Wilton, for example, is only 2,115 square feet.

“We do sell a lot of homes to empty-nesters,” McPadden said. “A lot of times they come looking for smaller square footage. They’ve already done the 3,000-square-footer.

“We save on the square footage and then put that [money] into the amenities.”

McPadden will build custom houses with a custom blueprint, but most of his work is semicustom, with individualized detailing on a collection of plans drawn up for him by a local architect. He finds that the details are more important to a lot of prospective buyers than the floor plan.

“The customers are so knowledgeable on everything, all the different ideas, they really want options, even if they’re building between 3 and 400 [thousand dollars]. It behooves us to offer as many of those things as we can.”

McPadden said the changes instituted after the housing market collapsed in the late 2000s — particularly the checks and balances on mortgage lending, making sure people don’t buy more house than they can pay for — should smooth out whatever economic bumps come in 2016 and beyond.

“We think it’s going to continue slow and steady,” he said. “Perhaps people will be a little hesitant before the election. But overall we think it’s going to continue at a moderate pace, as compared to 10 years ago, when it went too fast too soon.”