The Housing Interpreter—Current & Future Generations of Richmond

the

Housing InterpreteR CURRENT TRENDS IN REAL ESTATE AND THE RICHMOND REGION A PUBLICATION OF THE RICHMOND ASSOCIATION OF REALTORS®

JUNE 2013

CURRENT & FUTURE

GENERATIONS

of RICHMOND IN THIS ISSUE : • 5 G E NE R ATI ON S OF HOME B U Y E R S

• UR BA N L A ND I NSTI TU TE HOS T S A “ R E A L I T Y CHE C K ” — M AP P I N G V I SI ONS OF R E G I ONA L G R OW TH W I T H L E G O ® B L OC K S • F OR E CA S T I NG HOU SI N G D E M AND I N T HE R I CHMOND R EGI ON — C a n i t s u s t a i n t h e fu t u re w o r kforce?

• I NSI G HT S F R OM A “ S E NI OR WHI S P E R E R ”

WeAreTheR.com

5

Generations of Homebuyers

John Martin, President and CEO of the Southeastern Institute of Research, shares his insights into the mindsets and preferences of homebuyers from each generation

John Martin, of the Southeastern Institute

of Research in Richmond, has made a study of multiple generations of consumers— including their mindsets, lifestyle preferences, and what drives their purchasing decisions. During a special presentation hosted by the Richmond Association of REALTORS® this spring, he shared some of this information with local REALTORS® to help increase awareness of generational dynamics and how they affect the way homebuyers prefer to be assisted.

He advised that consumers from the Greatest and Silent generations have likely remained in the same home for the longest period of time, and therefore may require some assistance upfront getting up to speed on what home buying and selling transactions involve today. The term “Greatest Generation” was coined by journalist Tom Brokaw in his book of the same name, in which he depicted Americans who

came of age during the Great Depression and fought in World War II. Brokaw commented that this was the “greatest generation any society has ever produced”—characterized by a sense of honor, duty, dedication, and sacrifice. The “Silent Generation” is also considered to have been shaped in large part by the Great Depression—causing a mindset of duty before pleasure and consideration for the common good. As clients, homebuyers from the Greatest and Silent generations are characterized by their practicality, patience, and respect for authority.

Martin described the “Boomer” generation as a group that enjoys working cooperatively and wishes to be agents of transformative change. He discussed the emerging trend of those from this generation choosing to age in place, rather than moving to retirement communities. “What boomers really mean when they say they want to age in place

Greatest Generation 10,000,000

Silent Generation 28,000,000

Boomer Generation 76,000,000

Born 1909 - 1928

Born 1929 - 1945

Born 1946 - 1964

In contrast to the “latchkey kids” of Generation X, Martin depicted the Millenials as a generation shaped by “hyper-parenting.” is that they want to stay in their own communities,” he said. “Boomers are the beneficiaries of the longevity revolution; so they see another 20, maybe 30 more years ahead of them. They’re also totally motivated by being transformative change agents. They want to make an impact, well into their retirement years, and the way to make an impact is to stay in their own communities—so, they’re looking to sell their homes, but they’re also looking to buy one that allows them to age in place, right in their own communities,” he added. Martin also noted that as the much larger generation of Boomers replaces the significantly smaller aging population ahead of them, healthcare centers will increasingly become community “anchors.”

Martin described Generation X as independent, skeptical, technosavvy, task-driven risk-takers, shaped in large part by single parents or dual working parents. He referred to them as “latchkey kids,” with a developed sense of self-reliance. He advised that clients from this generation prefer to conduct home searches for themselves and enjoy access to the latest tools and apps to help them achieve this.

Finally, Martin introduced the Millenials—a generation he described as ambitious, co-dependent, tenacious, and fearless. In contrast to the “latchkey kids” of Generation X, Martin depicted the Millenials as a generation shaped by “hyper-parenting.” The information age and advances in mobile technologies have developed a mindset in this generation that Martin refers to as a “collective consciousness.” He explained that this generation has come to expect immediate responses to questions, tends to view authorities as equals, and likes to remain socially connected at all times, particularly with their parents. He cited social responsibility and sustainability as large concerns for this generation.

Generation X 75,000,000

Millenial Generation 81,000,000

Born 1965 - 1982

Born 1983 - 2001

Richmond’s Urban Land Institute (ULI) brings local professionals and community leaders together for a

REALITY CHECK considerations that denser areas of devleopment require (such as attractive design and compensating amenities); and the value of investment in attractive, high quality public buildings.

This May, Richmond professionals

and community leaders gathered at Virginia Commonwealth University’s Siegel Center for the Urban Land Institute (ULI) of Richmond’s “Reality Check” event. The event is described by ULI as a “map-based exercise for envisioning Richmond’s economic development and community growth,” as well as “a visioning activity rooted in real-world economic, demographic, and geographic data and trends analysis.”

The morning began with a keynote address by Ed McMahon, a ULI Senior Fellow for Sustainable Development. A D.C. metro region native, McMahon lamented that during the many years he has lived there, “they have never not been widening I-95.”

“Widening roads to accommodate traffic is like loosening your belt to accommodate obesity,” McMahon said. Some key points he touched on were the significance of planning; the value of green spaces;

Participants review a layout of the region, as it exists today, before beginning their simulation.

During the exercise that followed, participants representing diverse constituencies and points of view were divided into groups that discussed and established collective guiding principles to steer the course of the Richmond region’s growth and development. With these principles in mind, the groups then cooperatively and strategically placed symbolic Lego® blocks and yarn (signifying future businesses and housing types with color-coded Legos® and transportation systems with color-coded yarn), according to where and how each group envisioned these developments best placed.

According to ULI, the explorative excercise, more than anything, addresses the question, “What will make Richmond a place where businesses will want to locate and highly qualified people will want to work?”

The exercise took into account the region’s projected housing and job growth by the year 2035. The map on which the blocks and yarn were placed signified existing developments, as well as current roads, green spaces, and protected environments.

This activity demonstrated the complexity of land use decisions, while shedding light on the fact that many Richmonders

...the explorative exercise, more than anything, addresses the question, “What will make Richmond a place where businesses will want to locate and highly qualified people will want to work?” seem to share several common principles determining how they wish to see the Richmond region grow. These principles include regional cooperation, preservation of Richmond’s historic qualities and landmarks, environmental conservation, increased mixed-use developments and high transportation accessibility. “The paticipants in RVA Reality Check included business executives, non-profit leaders, citizens, elected officials, and government leaders.

Each arrived on game day with their own diverse interests and competing backgrounds and ideas; but when asked to envision a Richmond region as it grows in the future, their visions were very similar,” remarked Jeffrey Geiger, a Co-Chair for the event. “It highlighted the common vision of our diverse community about how we can grow economically and sustainably, while protecting the important aspects of what makes Richmond a great place to live, work, and play,” he added.

Geiger was surprised by the overwhelming desire of participants to see investment in public transportation, with more options and routes, and also their desire to see the built environment redeveloped to add more density, rather than growing at the outer edges.

“The gameday results trended towards sustainable, intelligent growth that respects a balance between the environment, infrastructure expense, and appropriate density,” Tim Davey, also a Reality Check Co-Chair, commented.

“We saw consistent density along and within the beltway that surrounds our community. We also saw that people want jobs closer to homes in a variety of land use applications and patterns. Once we finish aggregating the data, we plan to begin communicating the preliminary results through a number of venues. ULI is committed to meeting with any professional, public, or community group to present the data and listen for great ideas regarding how we can use this information to accomplish our regional economic development goals,” he added. During the event, Tim observed high enthusiasm among participants regarding the future of the Richmond region. “Our community is passionate about our future and many folks not typically involved in the community planning process are looking for a venue to participate,” he said.

Forecasting Housing Demand in the Richmond Region—

Can current and planned housing sustain our region’s future workforce?

This

April, Dr. Lisa Sturtevant, of George Mason University, took the stage at the University of Richmond and addressed a room full of local REALTORS® and community leaders with the findings of a study that helps answer the question— ”Can current and planned housing sustain our region’s future workforce?” The study was conducted by the GMU School of Public Policy’s Center for Regional Analysis, and covered the projected job growth in the Central Virginia region over the next 20 years, comparing it to the stock of housing (volume, as well as types and price ranges) that will be needed to accommodate this growth.

Net New Jobs: 2012-2032 Richmond Region

The study included information from a 2011 American Community Survey by GMU’s Center for Regional Analysis, as well as the U.S. Census Bureau. It included housing need for net new workers, but excluded the housing need for replacement workers, for households not in the labor force, and for current residents who live in substandard housing.

As the study compared housing demand over the next 20 years for each jurisdiction to the current annual rate of new residential building permits in those jurisdictions, it revealed a potential shortage of housing in Henrico County.

It also revealed that the greatest demand for single family type housing is projected be in Hanover, Henrico, and Chesterfield counties; while the greatest demand for multifamily units is projected to be in Henrico and Chesterfield counties. It concluded that suburban communities (like Chesterfield and Henrico) are not planning for sufficient townhouse and multi-family housing.

The demand for moderately priced housing (between $625 and $874 per month for renter-occupied and between $87,500 and $174,999 for owner-occupied) is projected to increase (by 29 percent and 7 percent, respectively) over the next 20 years.

The goal of this study and sharing its findings was to bring awareness to the Greater Richmond community about the trajectory on which the region is currently headed in terms of supporting its current and future workforce with a sufficient supply of housing. During her presentation, Dr. Sturtevant

Click to hear report commentary by Dan Heyman, Public News Service—VA

Dr. Lisa Sturtevant presents a study on projected regional job growth and the resulting housing demand through 2030 advised that as quality of life issues are becoming increasingly important to both workers and businesses, producing a sufficient supply of housing in the right locations, at the right prices, and of the right types, will be critical to the region achieving its full economic potential and outpacing its competitors in terms of economic growth and sustainability.

“A comprehensive, regional housing strategy that focuses on encouraging housing in existing employment centers and emerging road centers will help ensure that there’s housing available to folks where they need it; thereby keeping traffic conjestion low and creating an environment so that the economic potential of the Richmond region can be reached,” Dr. Sturtevant concluded.

Click here to access the full report—Housing the Richmond Region’s Future Workforce.

A video of the full presentation is available below.

THE GREEN SERIES

ENERGY STAR:

No longer just for applicances

By Guest Columnist, REALTOR® Tim Dunkum

From

its humble beginnings in the early 90’s to what is today—one of the most recognized green home certifications, ENERGY STAR has been on quite a journey, and today it is considerably more than a label on your washing machine or computer.

In 1992, the Environmental Protection Agency rolled out a voluntary labeling program, with the intention of promoting energy-efficient products. Due to their rapidly expanding popularity, computers and monitors were the first labeled appliances; but the label soon expanded to include many other pieces of office equipment and residential heating and cooling equipment. The EPA also soon added ENERGY STAR for buildings, to help businesses improve energy performance and cut down on overhead.

New consumer items and building products— like windows and roofing materials— continued to increasingly earn the designation.

To increase mass public awareness, ENERGY STAR introduced the Home Improvement Toolbox in 2000 to make it simple for homeowners to incorporate ENERGY STAR into their home improvement or repair projects.

This was followed closely by a public awareness campaign called Change; launched jointly by the EPA and ENERGY STAR to encourage people to help protect the environment by changing their products and practices to more energy-efficient ones. Its success was metered in 2004, when the American public awareness of ENERGY STAR reached 56 percent. This number has been rising exponentially ever since, and in 2009, awareness exceeded 75 percent; then passed 80 percent by 2011. It is now safe to say that most consumers in

this country are aware of the product labeling and search for it when making a purchase.

The ENERGY STAR certification for homes has been on a similar path to popularity. After the ENERGY STAR certified home was born in the early 2000’s, the number of homes earning the designation doubled between 2002 and 2006. They passed the 1 million mark in late 2009 amidst the recession, when new home starts were almost non-existent and buyers were very concerned about costs.

A more widespread understanding that longterm costs are as important as up-front costs has prompted more buyers to request energy-efficient features, or even a certified home. The builders have also been instrumental in advancing the ENERGY STAR certification on their new homes, with many of them committing to only building to this standard. The extra effort and slightly higher building costs are easily vindicated by buyer satisfaction and high long-term energy savings. Who can argue with twenty to thirty percent savings on annual energy costs?

The benefits of a certified home are experienced by the consumer in three ways: lower utility bills, enhanced performance, and environmental protection.

The math is not always easy to explain, so here is a quick summary: because the home is using less energy to condition the air and to heat water— plus all the appliances are more efficient—ENERGY STAR certified homes typically deliver greater than 20 percent savings on annual utility bills. The indoor air quality is improved and the temperatures are more consistent throughout the home; thus increasing the comfort of occupants.

Another simple, positive environmental impact

The extra effort and slightly higher building costs are easily vindicated by buyer satisfaction and high long-term energy savings. Who can argue with twenty to thirty percent savings on annual energy costs? of this type of construction: less energy consumption for each home means less energy that must be created.

Since much of our energy comes from fossil-fuel burning power plants, which cause air pollution, the impact on the environment will be huge, if the demand for energy-efficient homes continues to increase. It’s also worth mentioning that the more sustainable materials used in construction and the higher efficiency rated appliances within homes have shown less need for maintenance and replacement.

This adds to homeowners’ overall cost savings and has a significant environmental impact by keeping trash out of landfills and lessening new production of goods.

A clear example that the ENERGY STAR appliance branding and home classifications are making

an impact can be seen in the total savings to consumers, businesses and organizations of $24 billion in 2012 alone. That’s billion with a “B.” Simply stated: improve the quality of your living experience, while sustaining the environment, by purchasing ENERY STAR appliances and office equipment, and searching for builders using the ENERGY STAR certification on their homes.

Homeowners can roughly assess their home’s energy efficiency by using the Home Energy Yardstick, found at energystar.gov. The most complete way to assess a home’s energy consumption is through a home energy audit, performed by a licensed professional.

Source: energystar.gov

Insights from a Senior Whisperer One size does not fit all for senior specialist Cathy Saunders’ clients

When it comes to working with senior

clients during the home buying and selling process, one might envision only scenarios like leaving behind a lifetime of memories, or a family feud over which living situation is in someone’s best interests.

Cathy Saunders, a Richmond area REALTOR® who specializes in working with seniors, finds joy and diversity in working with this demographic of homebuyers and sellers. “Sometimes, when I tell someone I specialize in working with seniors, they ask: Isn’t that depressing?” she said. “I say not at all—it feels really good to be able to help people.”

She explained that some of the keys to helping seniors effectively navigate these changes are to listen to what their expectations and needs are, have patience as they take the necessary time to sort through various options, and to narrow as much criteria as possible up front. “Working with senior clients is often much like working with first time homebuyers,” Cathy said. “Many have been in their homes longer than the average homeowner and during that time, the market has changed. We need to inform them of issues that may not have been concerns when they purchased their current and previous homes,” she added.

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Cathy brings a unique perspective to real estate. She began her career as a social worker in a nursing home and earned her master’s degree in Gerontology. She worked in long-term care policy for a while and developed an interest in real estate sales as a hobby. “I quickly learned that working in real estate demands too much attention to be classified as a hobby,” she said. She eventually decided to turn her attention to a full-time career in real estate and use her previous experience to specialize in working with senior clients.

selling their current home and amenities they’re searching for in a new home to the ways they prefer to be communicated with during the process vary greatly from one client to another. “Something that many of them do have in common,” she explained, “is that they are often not just looking for a residential change, but also a lifestyle change. Sometimes I feel as though I’m even more of a social worker now than when I actually worked in social work.”

Though Cathy estimates that somewhere between a quarter and half of her clients fall into the senior demographic, she has experienced a remarkable amount of diversity among those clients. “Coming from the same generation is about all that makes them similar to one another,” she said. “Despite popular belief, I also have a lot of seniors who like to communicate through email,” she added. “Overall, they typically like to be very much involved in the home buying and selling process and aware of everything going on.” She explained that everything from the reason they’re

“Working with senior clients is often much like working with first-time homebuyers”

{ { Though Cathy estimates that somewhere between a quarter and half of her clients fall into the senior demographic, she has experienced a remarkable amount of diversity among her clients. “Coming from the same generation is about all that makes them similar to one another,” she said.

The most challenging aspect of working with seniors, Cathy notes, is the limited supply of viable housing options for them in the Richmond region. She explains that as these clients tend to be so variable in terms of the features and amenities they are looking for, it can be challenging to find local housing options that fit their exact specifications. “Some seniors want to make a lifestyle change as simple as exterior yard maintenance. Some enjoy gardening but would prefer to have the lawn mowed for them,” she said. “Unfortunately, there is currently a shortage in inventory of single family homes with yard maintenance or first-floor living which are also affordable.

Seniors often wish to place at least half the proceeds from the sale of their current home into retirement and no more than half into the purchase of their new home, but they’re most often unable to do that right now. The issue is similar to the workforce housing concern—we don’t yet have the housing stock we need for Richmond’s aging population,” she explained.

An additional concern Cathy cites is the lack of senior housing near public transit, and vice versa. “This isn’t just a helpful amenity for seniors who don’t drive, but it also helps to ensure that those working in service positions for seniors (like cleaning service workers and home health aides) all have a means of reaching seniors,” she said.

In the meantime, Cathy advises that agents broaden criteria when searching for senior housing, in order to initially view as many options as possible. This can begin with selecting single family, as well as condo/ townhouse in search fields. “Some options can be easily missed if condo/ townhouse isn’t included in a search because a client is only interested in detached homes. Some of the homes labeled condo/townhouse according to zoning are actually completely detached, which is deceiving,” she explained. She advises that a detailed inventory of features, such as a first floor master and first floor full bath in property descriptions also helps many senior homebuyers find what they’re looking for. Click here to learn about the Senior Real Estate Specialist (SRES®) designation for REALTORS®.

HOMES

Central Virginia Regional MLS is proud to announce the launch of the RVA Homes app.

RVA Homes provides the most accurate, on-thego access for REALTORS® and consumers to search homes, explore real-time listing details, view photos, conduct location-based searches with GPS, filter by a variety of criteria, and save and share results electronically.

Available June 17TH The new RVA Homes App will allow users to: Search listings with the touch-sensitive “draw search” and retrieve listings in the drawn area on the map; utilize a GPS enabled device to find listings nearby; or search using an address, city, zip, or MLS#.

Connect with an agent or client using the app’s messaging feature.

Post favorite listings and share saved searches via Facebook, Twitter, text messaging, or email.

Stop printing directions. With the one-touch maps function, agents and consumers enjoy the simplicity of guided directions straight to each listing.

View properties on an interactive map (street, satellite, and hybrid).

Filter searches by listing status, price, beds, baths, etc.

Visit the app store beginning June 17, 2013 to experience the speed, accuracy, and simplicity of this brand new mobile tool.