Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, March 19, 1995 TAG: 9503210120
SECTION: TODAY'S HOME PAGE: TH-12 EDITION: METRO
SOURCE: STEWART MACINNIS
DATELINE: LENGTH: Long
"There's a ripple effect here," he says. "Some of the other industries follow the home-building industry. When construction is up, they're up, too. People need furniture and appliances and curtains on the windows. They can spend as much or as little as they want."
The amount can be substantial, according to figures compiled by the National Association of Home Builders. On average, the association reports:
In the first 12 months after purchasing a newly built home, owners spend $6,500 on furnishings, decorations and improvements. The extra spending during the first year takes nearly 12 percent more of their income than they would spend on those items in a year they did not move.
People purchasing existing homes spend $2,268 in the first year on the same type of expenses. Those figures represent national averages.
Kris Wilson, owner of Interiors by Kris, estimates that her upper-end clients at Smith Mountain Lake spend at least $10,000 when they first move in.
"All of them need to put something on the windows," she says. "Many buy furniture, and many add some kind of wall covering."
Even young, first-time home buyers can spend a lot of money when they first move in, though they are more likely to spend money on basic decorating items, and slowly add furnishings as their budgets allow
"If they're moving from their parent's home or from an apartment, they probably don't have enough furniture to fill a house," Wilson says. "And, of course, there are the appliances."
She suggests new homeowners consult with a professional interior designer to develop a plan on how to decorate their home. Having a plan will help homeowners avoid wasting money.
She also suggests permanent fixtures, such as toilets and sinks, be as neutral as possible. People with extravagant tastes should express themselves in their furnishings, which can be moved out, or with wall coverings, which can be painted over. What suits one person may not suit a potential buyer years down the road.
The National Home Builders Association estimates that 70 percent of the extra money owners spend the first year goes to furnishings and property improvements. The most common furnishings purchased include household decorations, linens, furniture and mattresses.
The association also reports that nationally buyers of newly built homes spend a surprising amount for improvements, such as landscaping, decks, patios, fences and driveways.
In the Roanoke Valley, according to Dan Chitwood, a certified landscape architect, homeowners are more conservative when it comes to landscaping than people in other parts of the country.
Most people locally devote 1 percent or less of the value of their home to initial landscaping. That, he says, is usually enough for lawns and basic shrubs around the foundation.
"Five percent is a good optimum," Chitwood says. "For a $300,000 house, that would be $15,000. You can do a lot for that, but it's a reasonable amount."
Most builders include an allowance in the cost of construction for landscaping. That is often a minimal amount.
"I see people do the minimum and then they come back later to add to it," he says. "It's best to do it all at one time, though. The more you get done at one time the more efficiently you will use your money."
Buyers of existing homes often spend money correcting mistakes made by previous owners, such as replacing inappropriate shrubs.
Sometimes with shrubs, it's just a case of maintenance," Chitwood says. "The previous owner just let things get out of hand. Lots of times just proper pruning will take care of that."
The National Home Builders Association says buyers of existing homes are also likely to spend money on remodeling rooms, plumbing repairs, and heating or air-conditioning.
Both new and existing home buyers tend to make more major appliance purchases than non-moving homeowners. Home buyers spend the most on refrigerators, followed by televisions, clothes washers and dryers, computer equipment and lawn mowers and other yard equipment. Stoves and dishwashers are typically included in new homes.
Other kinds of spending, not directly related to the home purchase, also increase after the purchase. Automobile operating expenses, for example, are highest in the first few months after a home is bought, the same time that furnishing expenses are at their peak.
Food and entertainment spending are also higher as a percentage of income for both new home and existing home buyers in the first year after purchase.
The National Home Builders Association's analysis, based on the U.S. Bureau of Labor Statistics consumer expenditure survey, indicates the additional spending by home buyers is not done at the expense of other spending. Rather, the funds are either taken from accumulated savings or from funds that would normally be applied to savings.
Whitney, president of the local home builders association, says the rate of building in the Valley bodes well for retailers and service industries.
"We're holding our own this year," he says. "Both 1993 and 1994 were excellent years for home building. We're tracking with the trend from those years, though we may finish the year a little lower."
by CNB