Blogs > Sara Gutterman > October 2013 > The Future of the Building Industry

The Future of the Building Industry

It’s 2014 planning time, which generally means creative brainstorming about strategic growth strategies, extensive assessment of existing processes, and, alas, belabored conversations about spreadsheets and budgets. Since Green Builder Media is perpetually endeavoring to stay on the leading edge, our annual planning also involves the identification of key innovations and market trends that will influence the shelter industry over the next year (and beyond).

Here are a few concepts that we believe will be significant market drivers in 2014:

• Net-Zero: perhaps the most important factor driving the residential building market (not only next year, but over the next decade) will be ever-tightening energy codes, water conservation rules, and the interim application of green programs and rating systems. In the future marketplace for shelter, no home will be able to slip under the green radar as it might have in the past. A home with a good energy performance rating, for example, will simply be worth more than one that doesn’t, and homeowners will respond quickly to that financial liability. Proprietary rating systems will shift in and out of importance as states tighten their building codes. Once states and local codes mandate that all new homes need to meet a zero-net-energy standard—and that day is fast approaching—proprietary rating systems may eventually become obsolete.

• Sustainability: healthier, more resource efficient homes are here to stay. We won’t go backwards on this trend. As consumer demand for green homes increases, building professionals and manufacturers will continue to find innovative ways to leverage sustainability for competitive advantage.

• Smart homes: as consumers become increasingly more technologically savvy, so will their homes. Energy management and automation systems that allow consumers to remotely control their homes are already becoming commonplace. Consumer electronics will be integrated into surfaces and design features in creative ways to enable the seamless use of technology. We expect to see the proliferation of other smart technologies, such as glass that can harvest solar energy or change transparency to create privacy, innovative lighting solutions (surfaces rather than fixtures), and decorative thin-film solar sculptures and accents.

• Efficient design: contemporary, sleek, well-designed, compact homes with flexible spaces will become more prevalent and desirable in the future. Homeowners are looking for cleaner, simpler spaces without fussy details or unnecessary clutter that can be transformed for multiple purposes throughout the day.

• ‘Engineered homes’: building assemblies will combine products into a unified operational system that is designed for performance, pre-fabricated, and tested. This grown-up version of the modular unit will become ubiquitous as consumers look for innovative, affordable, and resource-saving shelter options.

• Focus on systems-thinking and building science: homes are not just becoming smarter technologically, they’re also becoming more sophisticated in terms of advanced construction techniques, whole-home systems thinking, and understanding the interaction of products, components, and design elements. However, as homes become tighter, we’ll continue to see a battle between efficiency and indoor air quality as it pertains to proper ventilation, moisture control, and long-term performance.

• Durability: consumers want to spend their weekends playing rather than fixing, so they are demanding homes with low maintenance requirements and costs.

• Custom solutions: there is no one-size-fits-all for green building, and while there will always be point chasers, savvy professionals understand that to remain ahead in the green building race, custom solutions are required for specific projects, climates, and geographies.

• Multi-generational living: as people are staying in their homes for longer periods of time, they require adaptable spaces that will enable them to safely age in place.

• Made in the USA: companies are touting American-made green products and local facilities to impress shareholders and gain customer loyalty. Locally/nationally sourced products are becoming increasingly more important to the sustainability dialogue.

• Product transparency: consumers are calling for increased transparency from manufacturers when it comes to the materials contained within the products that we use. The food and outdoor apparel industries are leading the charge with ingredient disclosure, and we’re starting to see groups like the Sustainability Accounting Standards Board (SASB) develop product transparency standards for a variety of industries, including construction materials.

• Creative capital: while the biggest issue for production builders is land acquisition, most small and medium-sized builders are facing challenges qualifying for project financing. The vast majority of small and medium builders operate on private equity, since community banks aren’t yet healthy or big enough to lend meaningful dollars. We anticipate that creative financing solutions will emerge to fill this hole in the marketplace.

• Valuation: We expect to see lending and appraisal vehicles that will finally incorporate energy efficiency and other sustainable features into the value of a home. As the moral imperative and financial benefits of sustainability become increasingly more vital, homeowners will become stakeholders not just in the design and construction of higher performing structures, but also in the proper valuation of those homes. They won’t be willing to accept the industry’s false metric of price per square foot without an accurate measure of quality and performance.

• Better consumer communication: builders are good at many things, but they have historically been known for being poor marketers. But this is changing—sustainability has laid the foundation for the development of a common language. Builders are figuring out how to more effectively communicate with consumers about the benefits of green homes, helping them understand the economic and emotional return on investment for sustainable living.

What additional trends do you think will affect the building industry over the next decade? Write to me at sara@greenbuildermag.com or follow me on Twitter @SaraGBM.

For more information about green building and sustainable living, visit www.greenbuildermag.com, like us on Facebook, and follow us on Twitter at @greenbuildermag and @VISIONHouseGBM for regular updates and breaking news.

Posted: 10/30/2013 11:54:30 AM by Mary Kestner | with 0 comments



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