Can owning a newly built home save your marriage? Make you more popular? Help you go on vacation? An ad campaign called "Start Fresh Buy New" suggests that’s so. But while its commercials gently stretch real life, the motivations behind this campaign are stark: Home builders want Americans to resume associating the idea of a new home with a place that’s newly built. If builders succeed in changing consumer attitudes, dealers could see demand rise far above the modest growth currently forecast.
The inspiration for “Start Fresh” comes in large part from one fact: From the late 1960s to this decade, newly built homes accounted for roughly 17% of the roughly 4.18 million single-family homes sold annually. But in recent years, that share of total single-family sales has dropped as low at 6%. And while sales in January of single-family homes reached a seasonally adjusted annual rate of 4.3 million, newly built homes accounted for just 8% of the total—roughly 350,000. Had that rate been at its historic 17% average, an additional 390,000 newly built homes would have moved into buyers’ hands.
That fact troubled 32 major new-home builders so much that they’ve joined together to create “Start Fresh Buy New.” With ad agencies’ help (plus some research conducted by Metrostudy, a sister company of ProSales), they’ve focused on what they call homeowners’ “joy gap” between the time-draining frustrations involved in maintaining and remodeling an existing house vs. the time-saving conveniences and customization available in a newly built home.
Thus the factoids on the site that declare “Counselors cite renovation as one of the top three causes of divorce” and “New home owners are more likely to host a football party than used home owners.” There’s also a poll with questions that lead you to conclude that the time spent keeping up an existing home is keeping you from going on vacation. Several commercials push the same message, including one in which a hardware store owner points frazzled existing-home owners to repair departments while he guides content new-home owners to the garden section.
The research that helped shape the campaign’s message found that traditional reasons for why people buy new—particularly life events such as getting married or having a baby—don’t rank as high today. Instead, home prices, interest rates, and being “tired of current house” all play at least as big a role, Metrostudy’s Jonathan Smoke reports.
Based on the 2012 research, 46% of home shoppers said they prefer existing homes, 19% want new, and 35% are indifferent or show no clear preference.
Surveys also found that quality of construction is the top factor that can sway shoppers toward newly built houses. “To convert those who prefer new and to convince more to prefer new, builders need to reinforce the advantages of new” and make it clear to people that “the long-term cost of owning an existing home is much higher than the differential in initial price,” Smoke says.