After weeks of decreases, mortgage applications rose 2.1% for the week ending May 7, 2021, according to the most recent report from the Mortgage Bankers Association.
Aiding the jump in mortgage applications was another sub-3% week of mortgage rates, which fell to 2.96% according to the Freddie Mac PMMS.
“The decline in rates helped the refinance index reach its highest level in eight weeks, driven by a 4% increase in conventional refinances,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Additionally, refinance loan balances increased for the fourth straight week, an indication that higher-balance borrowers acted to take quick advantage of lower rates.”
Kan added that the first week of May was strong for the purchase market, with applications up 13% from a year ago. That’s also around the time the COVID-19 pandemic began spreading throughout the country, he noted.
“Most markets this spring continue to see robust demand, but activity continues to be constrained by insufficient inventory levels, as well as homebuilder challenges related to the ongoing shortages and price increases for building materials,” he said.
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The refinance share of activity increased to 61.3% of total mortgage applications from 61% the previous week. The FHA share of total mortgage applications decreased to 9.9% from 10.1% the week prior. The VA share of total applications also decreased, from 11.9% to 11.7%.
Here is a more detailed breakdown of this week’s mortgage application data:
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.11% from 3.18%
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.27% from 3.31%
The average contract interest rate for 30-year fixed-rate mortgages decreased to 3.07% from 3.13%
The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.49% from 2.54%
The average contract interest rate for 5/1 ARMs increased to 2.57% from 2.76%
After hovering below 3% for a month, the average 30-year fixed mortgage rate popped back up six basis points to exactly 3% last week, according to Freddie Mac‘s PMMS.
Mortgage rates climbed north of 3% over the first few months of 2021, but crested at 3.2% in March before descending again. Despite such a favorable rate climate, there remains a shortage of homes for sale, pointed out Sam Khater, Freddie Mac’s chief economist.
“The lack of housing supply has been compounded by labor disruptions and expensive building materials that are driving up the cost of new housing, making it difficult for homebuyers to find homes to purchase,” Khater said.
Because mortgage rates held for so long in the sub-3% category, Fannie Mae‘s economic and strategic research group revised its expectations for 2021 and 2022 origination volume, noting that originations could have been higher if the market weren’t struggling with supply.
“We downgraded our expectation for 2021 purchase volumes by $43 billion from last month’s forecast to $1.8 trillion,” the ESR group said, “We expect refinance origination volume to be $2.2 trillion in 2021, a $125 billion upward revision from last month’s forecast, as incoming data continue to come in strong and interest rates have pulled back in recent weeks.”
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At current mortgage rates, the group estimated around 51% of all outstanding mortgage have at least a 50-basis point incentive to refinance, up from 42% in the previous months forecast. While millions of borrowers may have the opportunity, Joel Kan, the Mortgage Bankers Associations associate vice president of economic and industry forecasting, said the refi wave is still likely under volatility if mortgage rates continue to oscillate around current levels.
When mortgage rates failed to pick up in the last month, savvy homebuyers jumped back on them. But even with rates slipping to previous lows, borrowers are still battling it out in the bidding trenches on overheated home prices. April economic data for home sales showed year over year numbers are still above those in 2020, but beginning to dip sequentially
The American dream of homeownership is getting further out of reach for many Hoosiers.
As pandemic-era supply shortages began to return to normal, home prices fell, giving prospective homebuyers hope they could find something affordable. But those hopes were dashed for some who found they could not pay the high mortgage rates, which are currently more than double pandemic lows.
According to Paul Schwinghammer, former president of the Indiana Builders Association, markets will bounce back eventually. But when prices return to “normal,” many will still be unable to afford the investment that sustained previous generations.
“The days of a brand new home at $200,000 are probably very much in our rearview mirror,” Schwinghammer said.
As potential homeowners are pushed into becoming renters due to high mortgage rates, Schwinghammer said the thriving rental market is not the silver bullet to the housing market some think it is.
“That’s not the American dream,” he said.
Homeownership is increasingly expensive
Housing has become more expensive overall in the past several decades.
In 1950, Hoosiers made less — the median household income was $2,827, or about $30,000 in today’s dollars — now the median household income is $61,944. But housing prices have zoomed past that growth.
In 1950, the inflation-adjusted cost of the median home value was around $70,000. Today, the median listing price is $218,000, according to the state housing dashboard. In other words, the cost of housing has tripled, clearly outpacing wage growth in Indiana.
The cause of this gap is hotly debated. Some argue it is due to a decreased supply of housing — in Indiana, 16.8% of existing housing was built prior to 1940, and the percentage of homes built in the 2010s makes up the smallest slice of the housing pie at just 5.3%.
Experts point to the 2008 housing crash as a major factor in the building slowdown. After the crash, the membership of the Indiana Builders Association fell from 7,200 to 3,000, and the industry has been cautious ever since.
While building picked up pace in response to pandemic-driven demand, Indiana still has a 1.04% shortage of housing stock according to FreddieMac — the largest of all surrounding states.
Density, zoning and community opposition
At the most basic level, a housing unit cannot be cheaper than the raw cost to build it. During the pandemic, supply and demand saw timber, copper and other building materials spike in price, which was exacerbated by high labor costs. Schwinghammer argues this raw cost can be further increased by municipal regulations surrounding lot size, materials and aesthetics.
“That’s all well and good, except you’re ruling out homebuyers,” Schwinghammer said.
For affordability advocates, a relatively simple solution is increasing the amount of homes that can be built in an area by reducing lot size. This allows more homes to be built, increasing supply, all at a lower cost to builders, which are hopefully passed onto consumers.
But in practice, housing density is fiercely contested. Examples of density can range from apartment complexes to duplexes, which can be impossible if an area is zoned for single-family use. Other times, things like parking space requirements can thwart density attempts.
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But overwhelmingly, the biggest opposition to denser housing can come from neighbors and community members, whether it’s an apartment complex in Broad Ripple or a controversial zoning change to allow for multifamily housing in certain Bloomington neighborhoods. In fact, a survey of New York developers found that the majority of opposition to developments came from residents.
Ultimately, Indiana joins most of the country in having high rates of single-family detached housing, with the housing type making up 73.1% of all housing in Indiana, according to the state housing dashboard.
A shortage of affordable housing
While housing supply remains low in general, low-income Hoosiers are facing an even bigger gap when it comes to affordable housing supply. According to a Prosperity Indiana report, the state is 120,796 homes short of affordable and available rental homes, which means there are only 39 affordable units available for every 100 low-income renter households. The numbers show Indiana is performing worse than the regional average.
“Indiana is increasingly out of step with its Midwest peers when it comes to affordability and stability,” Andrew Bradley, policy director at Prosperity Indiana, said.
One method of helping low-income renters is Section 8 housing, a federal program that allows income-qualifying individuals to pay subsidized rents. But the program often fails to meet the demand — in Indiana, people are often on waitlists for three to five years before they can get housing, and sometimes the waitlists themselves are closed. There are currently seven waitlists open on the Indiana Housing and Community Development Authority website, spanning only about a third of counties.
With state and federal assistance so hard to find, some municipalities have attempted to fill the gap in affordable housing through local regulations.
In Bloomington, where housing is the most expensive in the state, local officials attempted to implement inclusionary zoning in 2017. Inclusionary zoning is a type of policy that requires developers to include a certain percentage of affordable units in their projects instead of trying to individually negotiate more affordable units through incentives.
That same year, the Indiana General Assembly banned municipalities from doing so, putting a direct halt to the city’s plans. Today, Indiana preempts municipalities from enacting four different types of equitable housing policies. In addition to inclusionary zoning, these include short term rentals, source of income nondiscrimination policies and rent regulation. Indiana is the only state in the country to prohibit all four policies.
Bradley said Indiana’s Housing Task Force is focusing too much on building new homes instead of sharing a focus on strengthening protections for tenants and improving current housing stock. He said this is partly due to a lack of representation of everyday Hoosiers on the task force.
He referenced Senate Bill 202, bipartisan legislation focused on tenant protections that was later stripped down to a study bill, as an example of the priorities of the legislature. The bill did not end up passing the House, and was not selected as a summer study topic.
“Suppliers of new housing have dominated the conversation at the Statehouse,” Bradley said.
Homebuyers suffer from high rates
Although commodity prices have decreased 10% across the board, Schwinghammer said, homebuyers are not seeing true relief due to high mortgage rates, which currently hover around 7%. Although mortgage rates have spiked as high as 16% in previous decades, the current rate is higher than pre-pandemic rates of around 4% and pandemic lows of 3%.
Part of this is due to the Federal Reserve’s sharp hikes in interest rates in order to combat inflation.
Ultimately, Schwinghammer said it would take 33% of the average person’s wage to begin homeownership — resulting in the highest debt to income ratio since 2007. Housing is effectively the least affordable it’s been in nearly two decades, he said.
As potential homebuyers are shut out of the market, builders have turned to the build-for-rent phenomenon sweeping the country in order to keep busy. BFR involves communities of single family rental homes that people can live in without making a purchase, allowing people to avoid interest rates.
Schwinghammer said BFR, which once took up 3% of the market, is now 15%.
As people struggle to afford new homes, pre-existing — and often cheaper — homes are selling less because homeowners don’t want to trade in their lower rates for the current 7% interest rate.
But the market is cyclical by nature, Schwinghammer said, and interest rates will likely be declining in a year.
“The natural ebbs and flows of the market will allow that to happen,” he said.
Today’s session was off to a stronger start thanks to a sharper rally in European bonds overnight, but domestic economic data pushed back early. This wasn’t immediately obvious due to the headline “miss” in Retail Sales, but the “control group” (excludes autos/gas/building materials) beat expectations 0.6 to 0.3. As we enter the PM hours, the absence of support from European trading is becoming more obvious. Bonds remain green, but at the day’s weakest levels.
Going forward, we may add 3.75 to the watch-list as a technical level as it acted as resistance overnight despite EU bonds making a case for a stronger rally.
This is the first post from Winston, the new GRS editorial assistant.
My wife and I have saved thousands of dollars by landscaping our own yard.
Four years ago, we were feeling overwhelmed by our back yard. We’d been in our home for a couple of years, had spent some time and money on the inside, and were ready to move on to backyard projects.
We spent a couple of seasons moving dirt around, trying different types of landscaping materials. This left us lighter in the pocketbook, but still unsatisfied with way things looked. Finally, we decided to contact a landscape architect. But we were worried that we couldn’t afford such a luxury, and doubted anyone would want to work on a small project like ours.
Professional Help
After asking the neighbors for recommendations, we discovered somebody who might be able to help. A long-time landscaper had just sold his business to his son-in-law to focus strictly on home landscape design. We scheduled an initial no-cost appointment with him, and instantly felt he had the skill and understanding to design a useable backyard we could enjoy.
He bid $500 for the design, which was over our budget. We talked with him about our $350 limit, and he found ways to reduce costs by providing black-and-white designs instead of color, and by leaving some beds for us to design ourselves.
After talking with us about some types of elements we liked and disliked (such as colors, textures, structures, and plant types), doing some measurements, and a few follow-up meetings, the designer presented us with the plans.
We received exactly what we were hoping for and could never have done ourselves: a beautiful landscaping plan that worked with both the house and the yard. Because he knew we planned to do the work ourselves over a period of years, the designer provided suggestions about where to begin, what to hire out, and how to implement the plan.
Laying the Foundation
Last summer, we tackled phase one of the plan.
A month after we received our plans, a local nursery had a 40%-off “going out of business” sale. With the designer’s list in hand, we were able to purchase about a third of our total plant materials at a substantial discount. We were worried because we weren’t anywhere near ready to put them into the ground yet. Fortunately, we live in a mild climate, and the plants survived several months in pots.
Hiring a landscape architect may have been the best thing we did for this project, but the second best was spending money to rent a track hoe to dig a base for the patio and to tear out a dilapidated 80-year-old concrete pond:
It amazes me that the rental yard in town would hand over the keys to such a destructive and powerful machine after only a five minute tutorial to a novice like myself. What would have taken months, if not years to accomplish by hand, this mighty machine accomplished in two days.
A third worthwhile expense was to have the concrete professionals come in to frame and pour the patio. We did the prep work — digging out the base, hauling out several yards of rock by wheelbarrow — but in a little over three hours, the concrete workers ensured a nice shape, proper drainage, and a beautiful pour for just over $800.
To finish last year’s backyard work, we put in the lawn. The ground was level and the soil was adequate, so all we had to do was rent a roller ($7), add minimal nutrients, and it was ready to go. We chose to lay sod because we have children and a dog, and it would have been very difficult to keep them out of seed-sown grass for an extended time. The small area lent itself to sod, and provided instant green for minimal cash outlay.
Putting It All Together
This year, we implemented phase two of our project. Hauling over 16 yards of compost and 1/4″-minus rock by wheelbarrow isn’t fun for most people, but I found it satisfying to see everything come together. Other things we’ve done include:
For the past two years, we’d been saving money for the plants, flowers, and shrubs we wanted. With a couple exceptions, we followed the professional design.
To build the three large raised gardening beds, some of the wood came from a deck we’d demolished four years ago.
To minimize water waste and the mental anguish of dragging hoses around, I installed six faucets in the various beds and gardening areas.
Before we’re finished, we’ll add the final grape arbor and to build a new fence around the garden.
Three years ago, our landscape architect estimated it would cost $25,000 to $30,000 to pay somebody else to implement his plan. By doing most of the work ourselves, we’ve spent a little over $3,500 on building materials, plants, shrubs, compost, soil, gravel, equipment rental, and the water system. We haven’t tracked our work hours, but our family of four has enjoyed the time outdoors and being together, even if it meant a lot of sweat equity.
The thrill of having dinner outside on the patio, enjoying the fruits of our labor, has exceeded our high expectations and has made the work and the expense worthwhile.
The average 30-year fixed-rate mortgage sank 10 basis points to 2.78% for the week ending on July 22, continuing several weeks of declines, according to mortgage rates data released Thursday by Freddie Mac‘s PMMS.
According to Sam Khater, Freddie Mac’s chief economist, concerns about the COVID-19 Delta variant and the recovery from the pandemic are taking their toll on economic growth.
While the economy continues to mend, Treasury yields have decreased, and mortgage rates have followed suit, said Khater. “Unfortunately, many homebuyers are unable to take advantage of low rates due to low inventory and high prices.”
While prospective homebuyers face a tough market, Khater added that declining mortgage rates give homeowners the chance to refinance and reduce their monthly payments.
Mortgage rates have mostly remained below 3% this year, despite predictions that they would return to higher levels earlier. Economists and investors are closely monitoring any indication from the Federal Reserve that it may begin tapering of mortgage backed securities and bond purchases.
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But that is “still a ways off,” Federal Reserve Chair Jerome Powell said at a Congressional hearing last week. The U.S. central bank plans to continue its asset purchases until there is substantial progress on jobs.
That accommodative stance is bolstered by concerns about the Delta variant and the market outlook, an analysis from Goldman Sachs noted this week. The Federal Open Market Committee is scheduled to meet next week.
President Joe Biden also pushed back at concerns over rising inflation during a press conference this week. “No serious economist” is suggesting the economy is headed toward unchecked inflation, he said.
“If we were to ever experience unchecked inflation over the long term that would pose real challenges to our economy,” Biden said, adding that his administration would “remain vigilant about any response that is needed.”
Since March 2020, the Fed’s asset purchases have been split between $80 billion of U.S. Treasury bonds and $40 billion of mortgage backed securities each month, keeping the cost of long-term borrowing low, in turn depressing mortgage rates. A year ago at this time, the 30-year fixed-rate mortgage averaged 3.01%.
Despite the low cost of borrowing, the housing market is showing signs of sluggishness.
Ten-year Treasury yields declined sharply last week, in part due to investor concerns about the spread of COVID variants and their impact on global economic growth, according to a report from the Mortgage Bankers Association.
Mortgage applications for new home purchases decreased 3% from May to June, sliding 23.8% year over year, according to the latest report from the MBA.
New single-family home sales decreased 5% to 704,000 units from 741,000, the trade group found. New home sales also declined slightly, from 68,000 to 66,000 in May. Overall, sales of new homes are down 7% from last year.
Homebuilders have encountered price increases for some building materials and labor shortages have dampened new home sales and increased home price appreciation, according to Joel Kan, MBA associate vice president of economic and industry forecasting. Persistent low inventory is keeping competition for available units high, he added.
In June, the average loan price rose to a record $392,370, according to the MBA.
“In addition to price increases, we are also seeing fewer purchase transactions in the lower price tiers as more of these potential buyers are being priced out of the market, further exerting upward pressure on loan balances,” Kan said.
“New home construction is taking on an increased role in the marketplace because many home owners with loans well below current mortgage rates are electing to stay put, and this is keeping the supply of existing homes at a very low level,” Alicia Huey, the NAHB chair, said in a statement. “While this is fueling cautious optimism among builders, they continue to face ongoing challenges to meet a growing demand for new construction. These include shortages of transformers and other building materials and tightening credit conditions for residential real estate development and construction brought on by the actions of the Federal Reserve to raise interest rates.”
Although interest rates have more than doubled since 2021, home builders are still cautiously optimistic about business, something the NAHB attributes to builders’ usage of buyer incentives. However, as sales have picked up this spring and existing home sales remain at record lows, the use of sales inducements from homebuilders has slowed.
In May, the share of homebuilders reducing home prices dropped to 27%, down from 30% in April and 36% in November 2022, with the average price reduction hovering at 6%, unchanged for the past four months. Additionally, the share of homebuilders offering some type of incentive dropped to 54% in May, compared to 59% in April and 62% last December.
“Lack of existing inventory continues to drive buyers to new construction,” Robert Dietz, the NAHB’s chief economist, said in a statement. “In March, 33% of homes listed for sale were new homes in various stages of construction. That share from 2000-2019 was a 12.7% average. With limited available housing inventory, new construction will continue to be a significant part of prospective buyers’ search in the quarters ahead.”
The three other indices monitored by the NAHB rose in May. The gauge measuring current sales conditions rose to 56, up five points month over month. The component analyzing sales expectations for the next six months rose seven points to a reading of 57. Compared to a month prior, the gauge measuring traffic of prospective buyers rose two points to 33.
Regionally, the three-month moving averages for HMI rose in three out of the four regions, with the West gaining three points to a reading of 41, the South increasing three points to 52, and the Midwest rising two points to a reading of 39. The Northeast held steady month over month at a reading of 45.
Another survey, the BTIG/HomeSphere State of the Industry Report, also reported an improvement in homebuilder outlook.
According to the survey, nearly twice as many builders reported sales that were better than expected (38%), than those who report sales that were worse than expected (20%) in April. In addition, nearly three times as many builders saw traffic as better than expected (42%) versus worse than expected (15%). The share of builders reporting a year over year decrease in sales also shrank to 34% in April, compared to 40% in March.
The BTIG/HomeSphere study is an electronic survey of approximately 75-125 small- to mid-sized homebuilders that sell, on average, 50-100 homes per year throughout the nation. In April, the survey had 124 respondents.
Like the homebuilder confidence survey, the BTIG survey also found that homebuilders are easing up on buyer incentives. Of the 124 respondents, 17% cut some, most of all prices versus 22% last month, while just 22% of surveyed builders reported increasing some, most or all incentives compared to 27% a month prior. In addition, 30% of homebuilders reported raising some, most or all base prices in April, up from 21% in March.
“New home demand momentum has continued to accelerate throughout the spring season, which is in-line with anecdotal public builder commentary,” Carl Reichardt, a BTIG analyst, said in a statement. “With comparisons for both sales and traffic beginning to ease meaningfully, we expect results should become stronger on a year/year basis next month.”
There has been a growing trend in recent years towards eco-friendly decor. The rising awareness of the environmental impact of our homes and the increasing availability of sustainable materials and products is driving this demand.
Rising awareness of our home’s impact on the environment and the growing availability of sustainable materials are driving this demand.
There’s also the rising popularity of minimalist and Scandinavian design styles that emphasize simplicity.
You can do numerous things to make your home more eco-friendly, from choosing sustainable materials for your furniture and flooring to using recycled materials in renovations.
Here are some of the latest trends in eco-friendly home decor for 2023.
Sustainable furniture
Sustainable furniture is made from materials harvested or manufactured in environmentally-friendly ways. This can include furniture made from reclaimed wood, bamboo, or other natural materials.
So, how do you recognize this type of furniture?
There are several certifications for sustainable furniture, including the Forest Stewardship Council (FSC) and the Sustainable Furnishings Council (SFC). Here’s what those certifications mean:
Forest Stewardship Council (FSC): The FSC is a non-profit organization that sets standards for sustainable forest management. FSC-certified furniture is made from wood harvested from forests that are managed in a way that protects the environment and workers’ rights.
Sustainable Furnishings Council (SFC): The SFC is a non-profit organization that sets standards for sustainable furniture manufacturing. SFC-certified furniture is made in a way that minimizes the environmental impact of the manufacturing process.
Greenguard Gold: Greenguard Gold is a certification awarded to products that meet strict emissions standards for indoor air quality. Greenguard Gold-certified furniture is made with materials that are low in volatile organic compounds (VOCs), which can harm human health.
These certifications ensure that the furniture was made from sustainably-managed forests and that the manufacturing process was environmentally friendly.
There are several sustainable furniture options available on the market today. These include furniture made from reclaimed wood, bamboo, and other natural materials. Many furniture brands like West Elm and IKEA are also committed to sustainability.
Natural textiles
Natural textiles are another great way to add a touch of sustainability to your home décor.
These textiles are made from fibers that are found in nature. These fibers can be obtained from plants, animals, or minerals. Some common examples of natural fabrics include:
Plant-based fibers: Cotton, linen, hemp, bamboo, jute, and sisal are all plant-based fibers.
Animal-based fibers: Wool, silk, cashmere, and mohair are all animal-based fibers.
Natural textiles are often considered more sustainable than synthetic textiles, as they can be produced without harmful chemicals. They are also usually more biodegradable, meaning they will break down more quickly in the environment.
But their benefits do not stop there for your home and the environment:
Comfort: They are often very comfortable to wear, as they are breathable and absorbent.
Hypoallergenic: Some natural textiles, such as wool and silk, are hypoallergenic, meaning they are less likely to cause allergic reactions.
Luxury: Natural textiles are often associated with luxury and quality.
Reclaimed materials
Reclaimed materials add character and history to your home décor. Look for furniture, flooring, and other home décor items made from reclaimed wood, metal, or other materials.
These items have a unique story to tell and will help make your home feel more special. We’ve compiled a guide below to help you incorporate more reclaimed and recycled materials into your home.
Volatile organic compounds (VOCs) are chemicals that can off-gas from paints and other building materials. These chemicals can be harmful to human health and the environment.
They can cause:
Eye, nose, and throat irritation: VOCs can irritate the eyes, nose, and throat, causing symptoms such as burning, stinging, and coughing.
Headaches and nausea: VOCs can also cause headaches and nausea.
Damage to the liver, kidneys, and central nervous system: Long-term exposure to VOCs can damage the liver, kidneys, and central nervous system.
Increased risk of cancer: Some VOCs are known to cause cancer.
On the environmental front, VOCs can decrease air quality by reducing visibility and increasing the amount of pollutants in the air. They also contribute to climate change by trapping heat in the atmosphere.
When choosing paints for your home, look for low-VOC or zero-VOC paints. These paints will emit fewer VOCs, which will help improve your home’s air quality.
Sustainable lighting
There are many sustainable lighting options available today. These include:
LED lights: Light-emitting diodes (LEDs) are the most energy-efficient type of light bulb available. They use up to 90% less energy than traditional incandescent bulbs and last up to 25 times longer.
CFL lights: Compact fluorescent lights (CFLs) are another energy-efficient option. They use about 75% less energy than incandescent bulbs and last about ten times longer.
Solar lights: Solar lights are powered by the sun, so they don’t require any electricity. They are an excellent option for outdoor lighting, such as pathways and patios.
Choosing sustainable lighting for your eco-friendly decor in 2023 helps reduce your overall energy consumption and environmental impact.
Indoor plants
Indoor plants are a great way to add a touch of nature to your home décor. They can also help to improve the air quality in your home. When choosing indoor plants, look for plants native to your climate. These plants will be more likely to thrive in your home.
Here are a few pointers to get you started on your plant-parenthood journey:
Conclusion
Embracing eco-friendly home decor not only allows us to create stylish and trendy living spaces but also enables us to make a positive impact on the environment.
By incorporating sustainable materials, repurposing and upcycling, and choosing energy-efficient options, we can transform our homes into havens of style and sustainability.
From upscale areas of Bethesda, Potomac, Chevy Chase, and Baltimore to waterfront properties on the Chesapeake Bay, Maryland offers a wealth of luxurious properties that offer a combination of elegance, comfort, and functionality. But what are the most sought-after home features that luxury homebuyers desire in this upscale market?
In this Redfin article, we will explore the top amenities and popular features that increase the allure and value of luxury homes in Maryland. Whether you’re a potential buyer seeking inspiration or a homeowner looking to enhance your property, join us as we delve into the world of luxury living and discover the must-have features that define Maryland’s most coveted residences.
7 most popular luxury home features in Maryland
1. Eye-catching curb appeal to attract luxury buyers
Creating excellent curb appeal is crucial when it comes to making a lasting impression on potential buyers in Maryland. The exterior of a home sets the stage for what lies inside, and a well-maintained and inviting exterior can pique buyers’ curiosity and make them eager to explore further. From the moment they step onto the property, buyers can get a sense of the overall aesthetics and condition of the home.
It’s important to consider the season and make updates accordingly. During the spring and fall, focus on tasks such as freshening up mulch, pruning shrubs, adding seasonal flowers, staining the deck, power washing walkways, and cleaning gutters. These simple yet impactful updates can greatly enhance the overall appearance of the home and create an inviting atmosphere that draws buyers in.
2. An expansive kitchen for entertaining
Buyers are often drawn to homes with updated kitchens because they recognize the value and enjoyment that comes with a well-appointed culinary space. Whether it’s preparing meals for loved ones or hosting social events, an updated kitchen sets the stage for a comfortable and luxurious lifestyle.
In luxury Maryland homes, you can expect to find high-end countertops crafted from premium materials such as granite, quartz, or marble. These countertops not only add a touch of elegance but also provide durability and easy maintenance. Additionally, the cabinetry in an updated kitchen is typically designed with a blend of functionality and style, featuring custom-made or semi-custom options that offer ample storage space and sleek designs.
Top-of-the-line appliances are another hallmark of an updated luxury kitchen. From professional-grade stovetops and ovens to built-in refrigerators and dishwashers, these appliances combine cutting-edge technology with exceptional performance. Homeowners can enjoy the convenience and efficiency of appliances that are designed to meet the demands of modern lifestyles.
3. High-end materials to heighten the luxe effect
In luxury Maryland homes, attention to detail is essential, including the materials used throughout the interior. From the flooring to the smallest fixtures, only the finest materials are chosen to create a truly upscale living environment. In terms of flooring, luxury homes often feature exquisite options such as marble, hardwood, or designer tiles that add elegance and sophistication to each room. These materials not only enhance the aesthetic appeal, but also provide durability and longevity.
When it comes to other aspects of the interior, luxury Maryland homes boast updated features that reflect the latest trends and advancements in technology. From state-of-the-art appliances to high-end light switches and fixtures, every aspect of the home is carefully selected to offer the best in terms of functionality and aesthetics. These modern and upgraded elements not only elevate the overall ambiance, but also provide convenience and efficiency for homeowners.
4. A spa-like bathroom and custom closets
An updated bathroom is a key luxury home feature in Maryland, particularly the primary bath, designed with luxurious finishes and attention to detail to create a spa-like experience.
Luxury bathrooms often feature high-end materials such as marble or granite countertops, exquisite tile work, and premium fixtures.
The focus of an updated bathroom in a luxury home is to enhance the personal space and lifestyle of the homeowners. It goes beyond mere functionality and incorporates elements of comfort and indulgence. Features such as spacious walk-in showers with multiple shower heads, soaking tubs, heated floors, and smart technology for lighting and temperature control are often included to enhance the overall bathing experience.
Custom-built separate his-and-her walk-in closets are a sought-after addition in luxury homes. These closets are designed to maximize personal space and organization, offering ample storage for clothing, accessories, and personal belongings. With dedicated space for each partner, these closets ensure convenience and ease when getting ready for the day.
5. Smart home innovations for luxury living
Smart home features have become highly desirable and sought-after in luxury Maryland homes. These features encompass a range of technological advancements that enhance convenience, energy efficiency, and overall home management.
Updated light fixtures and switches allow homeowners to easily control and customize the lighting ambiance throughout their living spaces. With smart thermostats, temperature control can be managed remotely, optimizing energy usage and providing personalized comfort.
Luxury homes often incorporate energy-efficient appliances, which not only contribute to a greener lifestyle, but also offer the latest advancements in functionality and performance.
6. A stylized mudroom for convenience
In today’s fast-paced and busy lifestyles, homeowners value functionality and efficiency. A mudroom offers the perfect solution by providing a designated area to remove and store outerwear, shoes, and other outdoor accessories. This helps keep the main living areas clean and clutter-free, promoting a sense of order and organization. Homeowners can incorporate custom storage solutions such as built-in cubbies, shelves, and cabinets to accommodate individual needs. The materials and finishes selected for the mudroom can complement the overall interior design style of the home, further enhancing its visual appeal.
The increasing popularity of mudrooms among potential homebuyers for Redfin Premier listings is a reflection of the desire for a seamless and well-organized lifestyle. It not only enhances the functionality and convenience of a luxury home, but also adds value and desirability in the competitive real estate market. Homebuyers recognize the practicality and efficiency that a mudroom brings, making it a must-have feature for those seeking a convenient and well-designed living environment.
7. A focus on sustainability
Sustainably sourced materials for floors and building materials have gained popularity in luxury homes. Homeowners are increasingly conscious of the environmental impact of their choices and prefer materials that are eco-friendly and responsibly sourced. These materials not only contribute to a more sustainable home, but also add a touch of elegance and uniqueness to the interior design.
High-efficiency heating and cooling units are another important aspect of smart home features in luxury properties. These systems optimize energy consumption, provide precise temperature control, and ensure a comfortable indoor environment year-round. By utilizing advanced technologies and smart controls, these systems offer both energy savings and enhanced comfort.
8. The perfect color palette for your space
Choosing the right paint colors is essential in transforming the look and feel of a home. Today’s contemporary paint colors reflect modern design trends, adding freshness and style to each room. A cohesive color palette creates flow and coordination with furniture and decor, enhancing the overall appeal. Up-to-date paint colors contribute to a sense of modernity and timelessness, attracting potential buyers looking for a well-maintained space. Neutral tones provide versatility and allow buyers to envision their own style. Consider factors like natural light and room size when selecting colors. Consulting with professionals can provide valuable guidance in choosing the perfect paint colors for your home.
Extra features and amenities to help stand out
In the luxury real estate market, there are several additional features and amenities that can elevate a Redfin Premier listing, making it stand out from other luxury properties. Two such features that have gained popularity are an upper-level laundry room and a butler’s kitchen. These additions not only enhance the functionality and convenience of the home, but also contribute to its overall appeal and desirability among potential buyers who are willing to pay a premium.
An upper-level laundry room
Placing the laundry facilities on the same floor as the bedrooms eliminates the need to carry heavy loads of laundry up and down the stairs, saving time and effort. This feature offers a practical solution for managing household chores and streamlining daily routines. Additionally, an upper-level laundry room can also include custom storage solutions, built-in cabinets, and countertops, further enhancing its functionality and organization.
A butler’s kitchen
This additional kitchen space is designed to facilitate meal preparation, entertaining, and catering without interfering with the main kitchen used for everyday cooking. It typically includes extra countertop space, sink, refrigerator, and storage for cookware and supplies. The butler’s kitchen allows homeowners to entertain guests and host elaborate events with ease, keeping the main kitchen tidy and private. This feature is particularly appealing to those who enjoy hosting gatherings or have a preference for professional-level cooking and entertaining.
Which cities in Maryland are known for luxury homes and features?
If you’re in the market to buy a luxury home, living in Chevy Chase, Bethesda and Potomac are renowned for their exceptional luxury homes and features in the Maryland real estate market. These upscale areas have a reputation for offering an unparalleled lifestyle, combining exquisite architectural designs with top-of-the-line amenities.
In May 2023, the average median sale price for properties in these cities reached $1,343,500. This figure significantly exceeds both the national median sale price and the state of Maryland’s median sale price by nearly $1 million, highlighting the desirability of these upscale communities.
A final note on luxury home features in Maryland
It’s crucial to consult with your real estate agent about the latest trends that can make a Maryland home feel luxurious. The real estate market is constantly evolving, and what was considered luxurious in the past may not hold the same appeal today.
If you’re buying a house in Maryland, your agent can provide valuable insights into emerging design styles, sought-after amenities, and popular features that are in demand among luxury homebuyers. Their expertise and knowledge of the luxury market will help you make informed decisions that maximize the appeal and value of your property in the eyes of discerning buyers.
As sustainable technologies develop alongside people’s desires to live more sustainably, people have begun turning to their homes to reduce their carbon footprints, But have you ever wondered if you could build a home that wasn’t just ‘less bad’, but instead actually restored the environment around it? You can. Enter the Living Building Challenge.
The Living Building Challenge represents the pinnacle of sustainable development and promotes equity, regeneration, and self-sufficiency. But what is it? How do you certify your home? Is it even possible?
Whether you live in a house in Bend, OR, or a home in Seattle, WA, read on to learn everything you need to know about Living Building Certification.
What is the Living Building Challenge?
The Living Building Challenge (LBC) is a green building certification program administered by the International Living Future Institute (ILFI), and was launched in 2006 in Seattle, WA. The program continues to evolve as new research and technology releases, and is currently on its fourth iteration (4.0).
The goal of the LBC is to encourage designers and homeowners to build structures and projects that contribute positively to their local environment. Structures achieve this by mimicking the ecosystem around them from when before the site was developed, creating a regenerative and sustainable built environment.
Living Building Challenge Petals
The Living Building Challenge organizes its requirements into seven performance areas called Petals. Each Petal is further divided into Imperatives (20 total), which address specific topics related to that Petal. Here’s a brief summary of the seven Petals.
1. Place
This Petal focuses on the location of the project and its relationship to the surrounding community and ecosystem. It includes imperatives such as habitat exchange, urban agriculture, and appropriate siting.
2. Water
The Water Petal emphasizes achieving a water balance within the building’s site. This means that a home or building should meet all its water needs through captured precipitation or recycled water, and manage its wastewater onsite.
3. Energy
100% of the project’s energy must come from on-site renewable energy on a net annual basis, promoting self-sufficiency and reducing the building’s environmental impact. This often includes installing solar panels, small wind turbines, and other renewable energy sources.
There aren’t specific requirements for energy per square foot, but the LBC insists that a building generate 105% of its energy needs.
4. Health and happiness
This Petal recognizes the importance of creating environments that optimize physical and psychological health and well-being. It includes imperatives related to indoor air quality, biophilic environments, and promoting physical activity.
5. Materials
It’s essential to encourage using materials that are non-toxic, transparent, and socially equitable. The Materials Petal requires projects to use safe and sustainable materials, and bans the use of materials that have negative environmental impacts or contain hazardous substances. The LBC has a “Red List” that contains a catalog of their banned materials and a “Watch List” of possibly problematic materials.
6. Equity
The Equity Petal encourages social equity and human rights within the building’s sphere of influence. This includes aspects such as human scale and humane places, universal access to nature and community services, and equitable investment.
7. Beauty
This Petal is about the aesthetic aspect of buildings and sites, recognizing that buildings should delight and inspire. The Beauty Petal insists that buildings incorporate design features intended solely for human delight, helping to connect people to the environment in a meaningful way.
Living Building Challenge for homeowners
While typically for commercial and public buildings, the LBC certifies homes as well. However, the LBC is extremely strict, so it can be time-consuming to design and build a certifiable home. As a result, only four residences in the US have received full certification (fulfilled all seven petals).
Unlike other green building standards that can be based on projections and simulations at the design stage, LBC certification is based on actual, proven performance after the building has been in operation for at least 12 consecutive months. There are four steps to receiving certification:
As sustainable technology and techniques advance, cost and building time should fall. The goal of the LBC is to promote sustainable and regenerative building practices, making them more accessible and affordable for all.
How do you certify your home?
The Living Building Challenge certification process is the same for all types of buildings, including houses. However, because homes are generally smaller and don’t have the same budgets as large commercial buildings, it can be harder for homeowners to fulfill every requirement.
Here’s a breakdown of how to certify your home through the LBC:
Registration: Start by registering your project with the International Living Future Institute. You need a premium membership to register, which costs between $50-$250
Design: Next, if you’re aiming for full certification, plan and design your home according to the LBC’s seven Petals and twenty Imperatives. This will likely require working with architects, engineers, and contractors who are experienced with sustainable construction and familiar with the LBC. Remember, the LBC requires that all aspects of the project, from the site choice to the energy systems to the building materials, comply with their standards.
Construction: Construct your home according to the design’s plans. Document your progress and gather evidence of compliance with each of the LBC’s requirements. This might include photos, receipts, contracts, and other documents that can verify your claims.
Performance monitoring: After construction is complete and you’re all moved in, you need to go through a 12-month performance period. During this time, you collect data and demonstrate that your home operates as designed and promised to the ILFI.
Audit and certification: Once your 12-month performance period is over, submit your documentation and data to the ILFI. An LBC Ready auditor will then review it to verify compliance with all the challenge’s requirements. If your home meets all of the requirements, you will be awarded LBC certification. If it only receives three out of seven Petals or just achieves net-zero energy use, it will receive separate certifications.
Certification levels
Full certification is incredibly difficult, so the LBC has three levels that a home or building can achieve.
Full certification: Full certification is awarded to homes and buildings that meet the requirements of all seven Petals.
Petal certification: Given to projects that satisfy the requirements of three Petals, including at least one of either Water, Energy, or Materials.
Net-zero energy building certification: Given to projects that achieve net zero energy but don’t meet all the requirements for Full or Petal certification.
The ILFI also offers additional certifications for houses, products, and entire communities.
Tips for homeowners striving for LBC certification
Even if you don’t receive full certification, using LBC’s guidelines can dramatically reduce your carbon footprint and create a sustainable, self-sufficient, beautiful home. Additionally, the ILFI offers other certifications such as the Living Home Challenge, which might be a more feasible option for some people.
Also, one of the most difficult Petals to fulfill is energy use. A good tip is to reduce the overall amount of electricity your home requires and limit your usage, instead of simply installing more renewable technology.
Pros and cons of the Living Building Challenge for homeowners
While there are many advantages to pursuing LBC certification for your home, there are a number of challenges and potential drawbacks. Here’s a summary of the main pros and cons:
Pros
Sustainability: LBC-certified homes are incredibly sustainable. They produce all of their own energy with renewable resources, treat all water on site, and are built using non-toxic, locally-sourced materials. This reduces their environmental footprint and contributes positively to their local ecosystems.
Health and well-being: LBC homes are designed with occupants’ health and well-being in mind. They use non-toxic materials, include biophilic elements that connect occupants to nature, and promote active, healthy lifestyles.
Utility savings: By producing their own energy and managing their own water, LBC homes can reduce or even eliminate utility bills. This can lead to significant long-term savings.
Resilience: LBC homes are designed to be resilient, with features such as on-site energy and water systems that allow them to operate independently of municipal utilities. This can be a major advantage in the face of power outages, water shortages, or other disruptions. LBC homes also usually last far longer than non-certified homes.
Cons
Cost: Pursuing LBC certification can be expensive. The cost of implementing renewable energy systems, advanced water treatment systems, and non-toxic materials can be higher than traditional building methods. Additionally, paying for specialized design and landscaping, and resource monitoring can be costly and time-consuming. However, while the cost can be higher upfront, sustainable materials are only marginally more expensive, and you will likely save a huge amount on utilities over the years
Regulatory barriers: In many areas, local building codes and regulations don’t allow some systems that LBC certification requires. This can make it difficult or even impossible to implement certain features of an LBC home, such as composting toilets or on-site water treatment systems.
Technical challenges: Some parts of the LBC, such as achieving net-zero energy or managing all water on site, can be technically challenging, particularly in certain climates or locations. You will likely have to work with specialists to find a solution, or choose another location entirely.
Availability of materials: Sourcing non-toxic, locally sourced materials can be difficult depending on the location and material. Make sure to do your research before committing to certification.
Final thoughts
There are many green certification programs that you can use to help build a sustainable home, all of which aim to reduce your carbon footprint. The Living Building Challenge is one of the strictest in the world and promotes lasting, beneficial building design.
For homeowners willing to undertake its rigorous certification process, it offers the opportunity to create a regenerative home, contributing positively to its local ecosystem and promoting the health and well-being of their family. However, pursuing certification also comes with its share of challenges, including time, money, materials, and technical difficulties.
Ultimately, whether the Living Building Challenge is right for you depends on your personal goals, resources, and commitment to sustainability. Even if you decide not to pursue full certification, the principles and practices of the LBC can provide tips and tricks for creating a sustainable, healthy, and resilient home.