Study by Owens Corning Shows Upgraded Exteriors Increase Home Values RISMEDIA, June 23, 2006—A study just released by Owens Corning (OWENQ.OB) revealed that respondents were as much as 50 percent more likely to consider purchasing a new home featuring a Cultured Stone(R) veneer exterior than one without. Further, respondents judged a home with an entryway enhanced with Cultured Stone(R) veneer to be $9,300 more valuable than the same home without the enhancement. The added value was double the average cost of such an enhancement and equated to a three percent increase in the perceived value of the home.
Builders Benefit from Cost-effective Differentiation
The survey results suggest a real and positive benefit to builders: even small upgrades with Cultured Stone(R) products on a home's exterior can be powerful. "A home has just one chance to make a first impression to each potential buyer," said Bob Heath, vice president of marketing, Owens Corning Cultured Stone(R). "A relatively minor upgrade can net a very favorable result in homeowner perception of value, and that's critical from the standpoint of differentiation."
Differentiation could soon become more critical than in recent years. The National Association of Home Builders' (NAHB) chief economist David Seiders stated 2006 may be a year of cooling home price increases. Seiders said many builders are experiencing buyer resistance to higher housing costs. "It's pretty obvious at this point that the real estate market is gradually shifting to more of a buyer's market," Seiders said.
"This survey proves what we've known for years: the cost vs. value equation of Cultured Stone(R) products on the exterior is positive and that has continued to drive the growth of this business," said Heath.
Methodology
The study, commissioned by Owens Corning, was fielded online by Gilmore Research Group to a panel of homeowners (provided by e-Rewards) with a household income of at least $75,000 who had purchased or shopped for a home in the past three years or conducted a major remodel. Respondents represented geographic diversity and were split randomly between one of two sample groups. To adjust for possible sample differences, both groups saw images of a control home. One group saw only images of the control house and a test house with no enhancements. The other group saw the same control house and a series of test houses that were identical except for varying levels of Cultured Stone(R) veneer enhancements: entryway, entryway and wainscot and whole facade. For each image, respondents were asked to estimate the selling price of the house in their area and asked to rate on a scale of one to seven the likelihood they would consider purchasing the house. In all, there were 1,500 participants in the survey, which was fielded in December 2005. |
