The supply of modestly priced starter homes continues to drop nationwide. A recent report by Realtor.com found that the number of homes priced above 750 000 $ grew 11 percent last year, while the number of starter homes priced under 200 000 $ fell by 8 percent.
Home values and rent continue to increase, but average salaries across the United States are not increasing at the same percentage. Consider that the average home value in 1950 was 7 400 $ and the household median income was 2 990 $. In 2010, however, the median home value was 221 800 $ (an increase of nearly 2 900 %) while the household median income was 49 445 $ which is an increase of only 1 554 % (source: U.S. Census Bureau via Curbed). That disparity is one of the reasons that the American starter home is out of reach for many entry-level buyers.
But designing and building starter homes doesn't have to be restrictive in order to keep costs at bay. Rather, smart design and smart product selection can help buyers achieve the American dream without sacrificing quality.
Some of the challenges when building starter homes:
KB Home, who partners with LP, takes advantage of LP® TechShield® Radiant Barrier, an easy, low cost energy efficient upgrade, and is at the forefront of companies trying to boost the supply of affordable entry-level homes. In KB Home’s Q1 earnings call, Chairman/CEO Jeffrey Mezger said that “offering more affordable products within our communities is also key. Our efforts to address affordability concerns by expanding the choice of square footages available to homebuyers are well underway, and we expect to continue to introduce lower square footage plans in select communities in the months ahead. A good example is our new Autumn Winds community in Riverside County, California. We added 1 400 and 1 500 square-foot plans to complement our initially planned lineup for this community, which had ranged from 1 600 to 2 400 square feet. Since the opening, these two small plans have generated about 25 percent of this community’s net orders.
Nationwide, smaller metro areas continue to be the most affordable entry points for first-time homebuyers. A recent U.S. News and World Report found that would-be buyers in Huntsville, Alabama, and Ft. Wayne, Indiana, only needed to earmark 19 percent of their income toward housing – far less than the percentage needed in the top 20 markets in the U.S.
Sustainability Solutions8 min
In our pursuit of sustainable and environmentally friendly products, we completed five LCAs and EPDs for our LP® Structural Solutions portfolio. Along with LP® SmartSide® Trim & Siding, these EPDs demonstrate the carbon negativity of our products. That means that our products store more carbon than is released during their entire life cycle, making us a meaningful part of the climate solution.Continue Reading
Sustainability Solutions6 min
In an era where environmental responsibility is paramount, we are proud to announce a remarkable achievement: the LP® Structural Solutions portfolio has been officially designated as carbon negative. This milestone is a testament to our unwavering commitment to redefining construction materials for the better with a focus on sustainability, resiliency and groundbreaking advancements.
It's no secret that many developers, architects and builders are reducing lot size as one way to hold down housing costs and maintain profitability. In fact, the rise of zero-lot-line homes, odd-lot/infill development and compressed parcel spacing is helping shape a new housing normal for many communities. This downsizing is focusing attention on minimum fire separation distance.
Resiliency Solutions6 min
To increase consideration for building more resilient homes, LP Building Solutions is partnering with the First Street Foundation®, a coalition working to help builders assess and protect against environmental threats from fire, extreme heat, flooding and wind.