Home Of The Future - Builders' Show...3 Exhibit 1 Projected Population of the US, By Race and Hispanic Origin Percent of Total Population 2000 2010 2015 12.6 15.5 16.6 Hispanic (of

1

HOME OF THE FUTUREFebruary 9, 2007

Orlando, FL

Presented at IBS 2007

by

GOPAL AHLUWALIAStaff Vice President - Research

Economics GroupNational Association of Home Builders

www.nahb.org

2

Demographic Changes

3

Exhibit 1Projected Population of the US, By Race and Hispanic Origin

Percent of Total Population

201520102000

16.615.512.6Hispanic

(of any race)

3.23.02.5All other races

5.04.63.8Asian alone

13.313.112.7Black alone

63.2%65.1%69.4%White alone, not Hispanic

322,371308,936282,125Population

(in thousands)

Source: U.S. Census Bureau. Compiled by NAHB Economics Group.

4

Exhibit 2Projected Population Change in the US, By Race and Hispanic Origin

Percent Change

26,86926,811Numerical Change (in thousands)

25.134.1Hispanic

(of any race)

27.930.7All other races

26.333.3Asian alone

12.112.9Black alone

2.4%2.8%White alone, not Hispanic

2010-20202000-2010


5

Exhibit 3Number Per Households By Type, Race and Hispanic Origin:

1995 to 2015

3.413.472.742.492.562010

3.36

3.46

3.51

3.58

HISPANIC ORIGIN (of any

race)

3.45

3.49

3.50

3.52

ASIAN AND PACIFIC

ISLANDER

2.71

2.77

2.81

2.85

BLACK

2.462.522015

2.522.592005

2.542.612000

2.562.621995

WHITETOTALYear

Average Number of Persons Per Household


6

Changing New Homes

7

Exhibit 4Median and Average Square Feet of Floor Area in Single Family Homes

Completed

1,450

1,600

1,750

1,900

2,050

2,200

2,350

2,500

1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006*

Squa

re F

eet

Median

Average

Source: US Census Bureau. Compiled by NAHB Economics(*) Based on the first three quarter of 2006

8

Exhibit 5Average Square Feet of Floor Area in Single Family Homes Completed

1,715

1,670

1,615

1,595

1,660

2,434

2,463

2,310

2,556

2,434

2,472

2,496

2,277

2,585

2,459

0 500 1,000 1,500 2,000 2,500 3,000 3,500

West

South

Midwest

Northeast

U.S.

2006*20051973

Source: US Census Bureau. Compiled by NAHB Economics(*) Based on the first three quarter of 2006

9

Exhibit 6Single Family Homes Completed with 3 Bathrooms or More

11%

13%

8%

12%

30%

27%

21%

21%

26%

17%

0% 5% 10% 15% 20% 25% 30% 35%

West

South

Midwest

Northeast

U.S.

2005

1987

Source: US Census Bureau, Characteristics of New Housing. Compiled by NAHB Economics

10

Exhibit 7Single Family Homes Completed with 4 Bedrooms or More

21%

21%

26%

23%

45%

40%

32%

36%

39%

29%

0% 10% 20% 30% 40% 50%

West

South

Midwest

Northeast

U.S.

2005

1973


11

Exhibit 8Single Family Homes Completed with One or More Fireplace

40%

37%

47%

44%

61%

49%

59%

57%

55%

56%

0% 20% 40% 60% 80%

West

South

Midwest

Northeast

U.S.

2005

1973


12

Exhibit 9Number of Stories in Single Family Homes Completed

55%

23%

44%

67% 10%

1%

0% 20% 40% 60% 80% 100%

2005

1973

1 story 2 stories or more Split level


13

Exhibit 10Single Family Homes Completed With Outdoor Features

20%

25%

30%

35%

40%

45%

50%

55%

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Patio

Deck

Porch


14

HOME OF THE FUTURE

HOME OF THE FUTURE REPORT IS BASED ON 60 INTERVIEWS WITH

ARCHITECTS, DESIGNERS, MANUFACTURERS AND MARKETING

EXPERTS AND ALSO ON RESPONSES TO AN EXTENSIVE SURVEY

QUESTIONNAIRE SENT TO A SELECTED SAMPLE OF ARCHITECTS, DESIGNERS,

MANUFACTURERS AND MARKETING EXPERTS

15

Exhibit 11INSIDE OF THE HOME BY 2015

65%

78%

0% 20% 40% 60% 80%

Upscale Home

Average Home

Somewhat to Significantly Different

57%

67%

0% 20% 40% 60% 80%

Upscale Home

Average Home

Somewhat to Significantly Different

OUTSIDE OF THE HOME BY 2015

16

Exhibit 12Will Changes to Homes in the Next Decade Be More Significant/Greater than in

the Past 10 Years?

About the same 41%

Yes 40%

No 19%

• Accessibility issues• Emphasis on technology• Greener Construction materials• Changing demographics, Aging population and growing

environmental concerns will continue to cause more changes.

Comments

17

Exhibit 13Compared to Today, Type of Housing Design More Commonly Built in 2015

(Percent of Respondents)Average Home

65%

34%

1%

0% 15% 30% 45% 60% 75%

Two-story

One-story

Split level

Upscale Home

56%

41%

3%

0% 15% 30% 45% 60% 75%

Two-story

One-story

Split level

2005 Census Data: Split level *One story 44%Two stories or more 55%

(*) Less than one percent.

18

Exhibit 14SIZE OF THE HOME

• Average size of new single-family home in 2005:

2,434 square feet

• Expected size of new single-family home in 2015:

Average: 2,300 – 2,500 square feetMedian: 2,330 square feet

19

Exhibit 15aAreas of the Home Likely to Increase, Decrease, or Stay the Same As a Share of Total Floor Area

during the Next 10 Years

Average Home

47%

47%

49%

50%

51%

56%

58%

68%

65%

67%

69%

79%

84%

67%

0% 20% 40% 60% 80% 100%

Dining Room

Closet Spaces

Master Bedroom

Parking Garage(s)

Master Bedroom Bath

Kitchen

Laundry Room

Living Room

Mud Room

Entry Foyer

Other Bedrooms

Basement

Other Bedroom Baths

Family RoomMost

Likely to Increase

Most Likely to Decrease

About the Same

DividedOpinion

20

Exhibit 15bAreas of the Home Likely to Increase, Decrease, or Stay the Same As a Share of Total Floor Area

during the Next 10 Years

Upscale Home

48%

50%

51%

55%

55%

58%

63%

68%

70%

71%

73%

77%

68%

72%

0% 20% 40% 60% 80% 100%

Master Bedroom

Living Room

Master Bedroom Bath

Laundry Room

Parking Garage(s)

Closet Spaces

Dining Room

Mud Room

Other Bedrooms

Other Bedroom Baths

Entry Foyer

Basement

Kitchen

Family Room Most Likely to Increase

Divided Opinion

About the Same

21

Exhibit 16ENTRY FOYER

One Story vs. Two StoryAverage Home

80%

20%

0%

25%

50%

75%

100%

One-story Two-story

Upscale Home

30%

70%

0%

25%

50%

75%

100%

One-story Two-story

22

Average Home82%

18%

0%

25%

50%

75%

100%

One-story Two-story

Upscale Home

45%55%

0%

25%

50%

75%

100%

One-story Two-story

Exhibit 17FAMILY ROOM

One Story vs. Two Story

23

Exhibit 18FUTURE OF LIVING ROOM

Average Home

13%

31%

55%

0% 25% 50% 75%

Stay as is

Become parlor/retreat/library or music room

Vanish

Upscale Home

28%

67%

4%

0% 25% 50% 75%

Stay as is

Become parlor/retreat/library or music room

Vanish

24

Rating on a scale of 1 to 5, 1=Not at all critical, 5=Very Critical

Exhibit 19aRating of Need for Items/Features in New Homes in Next 10 Years

Average Home

73%

75%

78%

83%

90%

0% 20% 40% 60% 80% 100%

Two car garage

Location of the home

Design

Low maintenanceExteriors

Family room

% Rated 4 or 5

25


Exhibit 19bRating of Need for Items/Features in New Homes in Next 10 Years

Upscale Home

93%

94%

96%

97%

98%

0% 20% 40% 60% 80% 100%

Security

Home office

Location of thehome

Family room

Design

% Rated 4 or 5

26

Exhibit 20CEILING HEIGHT

• Ceiling height in an average home has been rising for the past 10 years.

• By 2015, it is expected that most average homes will have 9’ ceiling on the first floor and some may even have 10’ ceiling.

• Upscale homes will have at least 10’ standard ceiling (10’ to 12’ range) in entry level and a 9’standard ceiling on the second floor.

27


Exhibit 21aImportance of Amenities/Products in the KITCHEN

Average Home

65%

70%

72%

74%

76%

0% 20% 40% 60% 80% 100%

Size (floor area)

Table space for eating

Double sink

Cabinet space

Counter space

% Rated 4 or 5

28


Exhibit 21bImportance of Amenities/Products in the KITCHEN

Upscale Home

94%

94%

94%

96%

96%

96%

96%

0% 25% 50% 75% 100%

Flooring

Walk-in pantry

Double sink

Counter space

Size (floor area)

Quality of appliances

Cabinet space

% Rated 4 or 5

29


Exhibit 22aImportance of Amenities/Products in the BATHROOM

Average Home

40%

45%

57%

61%

64%

0% 10% 20% 30% 40% 50% 60% 70%

Size

Linen closet

Large mirrors

Both shower stall & tub inmaster bedroom

Double vanity

% Rated 4 or 5

30

Upscale Home

88%

88%

94%

94%

94%

0% 25% 50% 75% 100%

Linen closet

Large mirrors

Size

Both shower stall & tubin master bedroom

Double vanity

% Rated 4 or 5


Exhibit 22bImportance of Amenities/Products in the BATHROOM

31

Exhibit 23Demand for TWO MASTER BEDROOM SUITES by 2015

Rating on a scale of 1 to 5, 1= will decrease significantly, 5= will increase significantly

% Rated 4 or 5

62%

13%

0% 20% 40% 60%

Upscale Home

Average Home

32

Exhibit 24Demand for OUTSIDE KITCHEN

Rating on a scale of 1 to 5, 1= will not change, 5= will increase significantly

% Rated 4 or 5

18%

66%

0% 20% 40% 60%

Upscale

Average

33

Exhibit 25Demand for OUTSIDE KITCHEN FEATURES

Rating on a scale 1 to 5: 1= Will not change and 5=Will increase significantly% rating 4 or 5

Average Home

6%

12%

13%

15%

35%

0% 20% 40% 60% 80%

Beerdispensers

/wine coolers

Cookingislands

Refrigerators

Sinks

Grills

Upscale Home

47%

58%

60%

65%

76%

0% 20% 40% 60% 80%

Beerdispensers

/wine coolers

Refrigerators

Cookingislands

Sinks

Grills

34

Exhibit 26Demand for OUTSIDE ROOM FEATURES

Rating on a scale of 1 to 5: 1= will not change, 5= will increase significantly

% rating 4 or 5

Average Home

3%

6%

10%

13%

16%

17%

26%

28%

0% 20% 40% 60% 80%

Patio Heating:Built in

Patio Heating:Portable

Decorative waterfeatures

Outdoor fireplaces

Ourdoor audio /TV equipment

Pools/spas

Outdoor lighting

Decking/patiocovers/enclosures

Upscale Home

27%

31%

57%

60%

70%

73%

74%

78%

0% 20% 40% 60% 80%

Patio Heating:Portable

Patio Heating:Built in

Decorative waterfeatures

Pools/spas

Outdoorfireplaces

Outdoor lighting

Ourdoor audio/TVequipment

Decking/patiocovers/enclosures

35

Exhibit 27Number of Bathrooms Expected by 2015

AVERAGE HOME: 2 FULL and 1 HALFTO

3 FULL and 1 HALF

UPSCALE HOME: 3 FULL and 1 HALFTO

4 FULL and 2 HALF

36

Exhibit 28Features Offered in the Next 10 Years: Standard vs. Optional

68%

81%

0% 20% 40% 60% 80% 100%

Average Home

Upscale Home

Increase in the number of features offered as Standard and decrease in features

37

Exhibit 29Exterior Materials Most Likely to Be Used in 10 Years

Rating on a scale of 1 to 5: 1=most unlikely, 5=most likely% rating 4 or 5

Average Home

11%

11%

21%

23%

38%

44%

50%

53%

57%

0% 20% 40% 60% 80% 100%

Aluminum

Cedar

Wood

Artificial stucco

Stone

Stucco

Brick

Fiber cement

Vinyl

Upscale Home

0%

8%

33%

42%

44%

61%

76%

83%

97%

0% 25% 50% 75% 100%

Aluminum

Vinyl

Artificialstucco

Cedar

Wood

Fiber cement

Stucco

Brick

Stone

38

Exhibit 30Standard Outdoor Features by 2015

Average Home

24%

42%

61%

70%

0% 25% 50% 75% 100%

Rear porch

Deck

Patio

Front porch

Upscale Home

79%

61%

76%

79%

0% 20% 40% 60% 80% 100%

Rear porch

Deck

Patio

Front porch

39

Exhibit 31Location of Stairs

Average Home

39%

61%

0% 25% 50% 75%

Stairs willmove tothe backor side ofthe home

Stairs willstay in the

foyer

Upscale Home

56%

44%

0% 25% 50% 75%

Stairs willmove to theback or sideof the home

Stairs willstay in the

foyer

•Stairs will be more functional rather than a piece of decoration.

•Upscale homes will have two staircases.

40

Exhibit 32Front Doors by 2015

87%

0% 25% 50% 75% 100%

Single door36" or 42"

wide withoutside lights

AVERAGE HOME

34%

39%

0% 15% 30% 45%

Double doorwith or

without sidelight

Single door42" wide with

side lights

UPSCALE HOME

•More single doors used in upscale housing, partly because of exterior design.

•Door size --- 3’ 6” wide doors, looks more elegant will be used extensively in place of a 3’ wide door.

•Side lights will be used (if there is a room).

•Upscale homes will have two side lights and one above the door.

OR

41

• Lighting driven by the market.• Chandelier in the dining and entry foyer• Definite trend towards recessed lighting• Recessed cans more in kitchen, media room,

finished basements.• Some unique hanging fixtures designed as

artwork.• Industry has not recognized power of mood

lighting.

Exhibit 33LIGHTING

42

• A trend away from white.

• A lot more interest in colors.

• Interior of home seeing bolder colors.

Exhibit 34COLORS

43

Exhibit 35Fiber Optic Network by 2015

Average Home

34%

66%

0% 50% 100%

No

Yes

Upscale Home

13%

87%

0% 50% 100%

No

Yes

44

Exhibit 36Electronic Features Standard in AVERAGE HOME by 2015

36%

43%

59%

61%

78%

0% 10% 20% 30% 40% 50% 60% 70% 80%

Remote control fireplaces

Multi Zone controlled HVAC

Multiline phone system

Structured wiring system

Programmable thermostat

CommentsOnly basic technology will take hold in average home: security system, automatic lighting control, and energy management system.

Structured wiring is being installed in about 40% of new homes today, but use of wireless technology may enter housing market in big way.

45

Exhibit 37aElectronic Features Standard in UPSCALE HOME by 2015

75%

77%

80%

80%

80%

81%

86%

87%

88%

0% 15% 30% 45% 60% 75% 90%

Lighting control system

Monitored burglar/fire/toxic gas alarm system

Instant hot water in bathrooms/kitchens

Structured wiring system

Programmable thermostat

Monitored burglar alarm system

Whole home control/automation system

Multiroom audio

Multi Zone controlled HVAC

46

Exhibit 37bElectronic Features Standard in UPSCALE HOME by 2015

52%

54%

62%

68%

70%

70%

74%

74%

0% 15% 30% 45% 60% 75% 90%

Sensor-operated faucets

Window covering controls

Integrated HVAC andsecurity system

Remote control fireplaces

Communicating thermostat

Integrated security andlighting control system

Multiroom video access

Multiline phone system

47

Exhibit 38aTrends in AVERAGE HOMES Expected in the next 10 years

50%

56%

63%

68%

0% 20% 40% 60% 80% 100%

You will see a trend awayfrom white to bolder colors

in the house

You will see a growing trendtowards universal

design/handicap access

You will see a definite trend towards recessed lighting

Toilet in the masterbedroom bath will have

separate enclosure

48

Exhibit 38bTrends in UPSCALE HOMES Expected in the next 10 years

63%

66%

76%

79%

84%

87%

88%

0% 20% 40% 60% 80% 100%

You will see a growing trend towards universaldesign/handicap access

You will see a trend away from white to boldercolors in the house

You will see a definite trend towards recessedlighting

Most garage doors will increase from 7’x 9’ to8’x 10’

Two car garages will increase from 20’x20’ to24’x24’

The master bedroom bath will have multipleshower heads

Toilet in the master bedroom bath will haveseparate enclosure

49

Exhibit 39aTrends in Neighborhood/Communities Expected in the next 10 years

AVERAGE HOME

54%

63%

67%

67%

73%

78%

84%

91%

94%

0% 20% 40% 60% 80% 100%

Gated/distinctive communityentrance: Open

Greater access to commercialfacilities

Better access to publictransportation/alternative

transportation

In-fill development

More recreational opportunitiesintegrated into development

Walking/jogging trails, walkways, etc.in the new community

More mixed-use facilities withindevelopments

Higher-density development (smallerlots)

Dedicated open space/communalspace in the subdivision

50

Exhibit 39bTrends in Neighborhood/Communities Expected in the next 10 years

UPSCALE HOME

48%

49%

51%

51%

55%

57%

61%

66%

81%

85%

0% 20% 40% 60% 80% 100%

More services integrated intodevelopment

Higher-density development (smallerlots)

In-fill development

More mixed-use facilities withindevelopments

Gated/distinctive communityentrance: Guard controlled

Gated/distinctive communityentrance: Electronic card

More cul-de-sacs than thru streets inthe new subdivision/ communities

Dedicated open space/communalspace in the subdivision

More recreational opportunitiesintegrated into development

Walking/jogging trails, walkways, etc.in the new community

51

Exhibit 40aGreen Building Trends Expected by 2015

AVERAGE HOME

66%

75%

89%

89%

98%

0% 25% 50% 75% 100%

Builders will seek green certification forhis/her products

You will see greater desire forgreen/sustainable product offering

Energy performance will play a bigger role inwindow purchases

There will be a growing trend on water orenergy conservation devices

You will see an increased demand for energyefficiency appliances and mechanical

equipment

52

Exhibit 40bGreen Building Trends Expected by 2015

UPSCALE HOME

73%

76%

94%

97%

97%

0% 25% 50% 75% 100%

Builders will seek green certification forhis/her products

You will see greater desire forgreen/sustainable product offering

There will be a growing trend on water orenergy conservation devices

Energy performance will play a bigger role inwindow purchases

You will see an increased demand for energyefficiency appliances and mechanical

equipment

53

TRENDS

54

Average Home Upscale Home

Average Size 2,330 sq. ft. >4,000 sq. ft.

Single vs. Two Stories Two-story Two-story

Entry Foyer One-story One-story

Family Room One-story Two-story/One-story

Living Room Will vanish or become parlor/retreat/library

Will stay as is or become parlor/retreat/library

Ceiling Height 1st floor: 9' 1st floor: 9'

2nd floor: 8'/9' 2nd floor: 9'/10'

Two Master Bedroom Suites x √

Outside Kitchen x Definitely yes

Exhibit 41

55

Average Home Upscale HomeOutside Kitchen Features x √

Grill x √

Sinks x √

Cooking Island x √

Refrigerators x √

Beer Dispensers x Maybe

Other Outdoor Room FeaturesDecking/Patio Covers x √

Outdoor Lighting x √Outdoor Audio/TV Equipment x √Outdoor Fireplace x √Pools/Spas x √Decorative Water Features x √Patio Heating x x

Exhibit 42

56


Bathrooms Two full one half to Three full one half to Three full one half Four full one half

Exterior Wall Material Vinyl StoneFiber cement Brick

Brick StuccoFiber cement

Outside FeaturesFront Porch √ √Rear Porch x √Patio √ √Deck x √

Stairs In the foyerMore in the back or side of the

homeFront Doors Single door, 36" or 42" wide Single door 42" with side lights or

Double door with or without side lights

Fiber Optic Network √ √

Exhibit 43

57

Average Home Upscale HomeElectronic FeaturesProgrammable Thermostat √ √Structured Wiring System √ √Multiline Phone System √ √Multi Zone Controlled Hvac x √Remote Control Fireplaces x √Instant Hot Water in Bathrooms/Kitchens x √Monitored Burglar Alarm System x √Monitored Burglar/Fire/Toxic Gas Alarm System x √Lighting Control System x √Multiroom Audio x √Multiroom Video Access x √Whole Home Control/Automation System x √Integrated Security and Lighting Control System x √Integrated Hvac and Security System x √Communicating Thermostat x √

Exhibit 44

58

Average Home Upscale HomeTrends Expected in New Homes in the Next 10 Years

Toilet in the Master Bedroom Bath Will Have Separate Enclosure √ √

Definite Trend Towards Recessed Lighting √ √

Growing Trend Towards Universal Design/Handicap Access √ √

Trend Away From White To Bolder Colors In The House Divided opinion √

Two Car Garages Will Increase From 20’X20’ To 24’X24’ x √

Most Garage Doors Will Increase From 7’X 9’ To 8’X 10’ x √

The Master Bedroom Bath Will Have Multiple Shower Heads x √

Exhibit 45

59

Average Home Upscale HomeFeatures in New Neighborhood/Communities by 2015Dedicated Open Space/Communal Space in the Subdivision √ √

Higher-Density Development (Smaller Lots) √ x

More Mixed-Use Facilities within Developments √ x

Walking/Jogging Trails, Walkways, etc. in the New Community √ √

More Recreational Opportunities Integrated into Development √ √

More Services Integrated into Development √ x

Better Access to Public Transportation/Alternative Transportation √ x

Greater Access to Commercial Facilities √ x

Exhibit 46

60


Inside of the Home 100% 78%

Outside of the Home 91% 85%

Yes 40%About the Same 41%

Average Home Family room area likely to increase

Living room most likely to decrease

Upscale Home

1. Homes by 2015 will generally look like the homes of today or would by very much different (Rated as "somewhat different" to "significantly different")

2. Changes to homes in the next decade be more significant/greater than the past 10 years

3. Areas of the home likely to increase, decrease, or stay the same

Family room and kitchen area likely to increase

Exhibit 47

61

4. Top 5 features rated critical to very critical

Average Home Family room, Low maintenance exteriors, Design, Location and Two-car garage

Upscale Home Design, Family room, Location, Home office, and Security

5. Top 5 most rated features in kitchen and bathrooms

Average Home Size, Double sink, Counter space, Cabinet space, and Table space for eating

Upscale Home Quality of appliances, Double sink, Walk-in pantry, Flooring, Size, Counter Space, and Cabinet Space

6. Increase in the number of features offered as standard

Average Home Yes

Upscale Home Yes

Exhibit 48

62


Green Building Trends by 2015

Increased Demand for Energy Efficiency Appliances and Mechanical Equipment √ √

Growing Trend on Water or Energy Conservation Devices √ √

Energy Performance Will Play A Bigger Role in Window Purchases √ √

Greater Desire for Green/Sustainable Product Offering √ √

Builders Will Seek Green Certification for His/Her Products √ √

Source: Economics Group 2007 NAHB Study “Home of the Future”

Exhibit 49

Documents

Home Of The Future - Builders' Show...3 Exhibit 1 Projected Population of the US, By Race and Hispanic Origin Percent of Total Population 2000 2010 2015 12.6 15.5 16.6 Hispanic (of