Beyond the baby boom: emerging markets for custom homes

Custom Home, Jan-Feb, 2003 by Meghan Drueding

Latinos, too, are snapping up custom homes in some parts of the country. "When the Argentine economy collapsed, there was a huge influx of well-heeled Latin Americans into Florida," says Pitkin. "People were buying homes as safe havens for themselves, protecting their assets, and not just in Miami--this was all over Florida. Now, the same thing might happen with the Brazilian economy." According to John McIlvaine, senior resident fellow at the Urban Land Institute, the buying power of Latino immigrants and their children is rapidly escalating. "In Southern California, some pretty wealthy Hispanic families are already impacting the custom home market," he says.

Regardless of their national origin, immigrants who can afford to are putting their money into their houses. "The tendency is to buy a big house before buying a Mercedes," says NAHB director of research Gopal Ahluwalia of foreign-born U.S. residents. "The house is the first priority."

In terms of home design and construction, whether the needs and desires of immigrants differ from those of native-born buyers depends on the individual client. An immigrant's household structure, his ties with his native country, and the amount of time he's lived in the United States all play into the existence or absence of any culturally influenced preferences.

Teri Froetschel, design director at Willis Homes, a custom builder in El Paso, Texas, has noticed that her many Mexican-American buyers often cite their dislike of the regionally popular Southwestern Pueblo-style architecture. "In Mexico, that style connotes low-cost housing" she says. Stuart Narofsky, an architect on Long Island, outside New York City, has designed houses for several Indian clients, and the more traditional among them sometimes establish multiple-generation households. "I've designed a few houses with two master suites, one for the parents and one for the grandparents," he says. "My Indian clients have also tended to want masonry construction rather than wood--in the part of India they're from, wood is used only as a decorative surface."

But architects Lane Williams of Seattle and Mark Macy of San Francisco, both cities with a high percentage of Pacific Rim immigrants, say they've observed no difference between preferences of native-born and foreign-born clients. "In San Francisco, everyone is interested in feng shui--it doesn't matter where you're from," Macy says.

The bottom line regarding high-end housing demographics? Each geographic market holds its own specialized niches. Every area is changing, but no two are changing in the same way. To capitalize on new markets now (and five, 10, or 15 years down the line), builders must do their homework. Rudimentary market research isn't as complicated as one might think--it may be as simple as going online. The U.S. Census Bureau (www.census.gov) recently released its small-area information, which contains demographic, social, economic, and housing characteristics of counties, municipalities, and metropolitan areas all over the country. A San Diego market research company called Claritas (www.claritas.com) has developed an easy-to-use online system for presenting general consumer profiles based on ZIP codes.