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Demand for high-end homes sees uptick, brightens outlook

Rochester Business Journal
March 29, 2013

Local builders and designers of high-end homes expect solid demand this year due to baby boomers' evolving needs, rising confidence in the economy, low interest rates and other factors.
 
Yet customizing homes still has its share of challenges, like the need to balance production schedules with clients' desire for unique dwellings, high property taxes that sometimes limit homeowners' plans, and rising costs for building materials.
 
Marie Kenton, president of Pittsford-based Ketmar Development Corp., says inquiries from prospective clients have risen in the past 12 months. Eight homes in the $1 million range have sold or been reserved recently in the firm's Malvern Hills community, near the intersection of Pittsford-Mendon Road and Thornell Road in Pittsford.
 
A year ago, the local market for such homes was essentially "fallow," says Kenton, who founded Ketmar in 1988.
 
"So I think this has been a happy change in the last year," she adds.
 
Patrick Morabito of Pittsford-based Patrick J. Morabito, A.I.A., Architect P.C., says his firm has received numerous inquiries in the past year. Single-story or first-floor living continues to top the list of desires for clients 50 and older, he adds.
 
Nicholas Haralambides, vice president of construction at Aristo Development Inc. in Fairport, says local demand for fine homes is still somewhat lower than in years past, but the clientele is "still there."
 
"I think a big piece of it, obviously, is the low (interest) rates," he says. "That's a driving force, especially with people that are spending a little bit more money. They view it as a good time to borrow money at such low rates, and they've been getting advice from their financial planners, actually."
 
Overall, the local housing market has made strides since 2011, according to the Greater Rochester Association of Realtors. Annual closings rose 8 percent in 2012 from the prior year, while the median sale price climbed 4 percent from $120,000 to $125,000. The total dollar volume of sales gained 13 percent from 2011, reaching $1.5 billion last year.
 
With disposable income at the ready, clients seeking high-end homes often request design features that showcase originality. Ketmar, for instance, recently had a Pittsford client who asked for a staircase using curved glass instead of wooden spindles, which involved working with a manufacturer in Buffalo.
 
"We haven't done many of those," Kenton says.
 
Other features Ketmar clients have requested recently include indoor pools, walk-in coolers instead of traditional refrigerators and radiant floor heating.
 
"We've seen more people who are looking to live in their homes long-term doing recessed floors so there's no curbs in the showers," she adds.
 
Rooms with walls and halls are becoming increasingly passe.
 
"I'm seeing more and more open floor plans-people wanting to combine dining areas with kitchens, great rooms, hearth rooms," Kenton says. "They want to gather, so these rooms have to be open to one another.
 
"Also, I don't see stairs in the foyer as much anymore."
 
Many clients now opt for stacked space instead of grand second-floor overlooks.
 
Amenities such as whirlpool tubs are less common now unless homeowners are certain they will use them regularly, Kenton says.
 
At Morabito's firm, more clients want the freedom of controlling their homes wirelessly through smart-home technology. Energy efficiency also tops the list of wishes: Two clients recently asked for geothermal heating and cooling systems.
 
"We've done some projects where no living rooms or dining rooms occur," Morabito says. "There's flexible space that could be used for either one."
 
First-floor master bedrooms continue to be sought after, particularly for baby boomers who do not want to contend with stairs. Half-round windows, a hallmark of 1980s architecture, have fallen by the wayside, Morabito adds.
 
One recent example of a fine home design at Morabito's firm involves a 7,000-square-foot alpine-like abode on 39 acres in the Rochester area. The project, on which construction is about to begin, will integrate timber-frame construction with traditional building techniques. Stone and metal roofing also play key roles in the design.
 
Inside, the home boasts a secret stairwell leading to an office that will likely have a billiard table. The last time Morabito designed a hidden passageway for a home was 20 years ago, when the homeowner wanted one leading from the den to his "man cave."
 
Aristo clients want to know "that everything we build and design, they're going to actually use," Haralambides says. "Especially in New York State, you're going to pay taxes on it, and that's, I think, a big driving force."
 
In what appears to be a continuation of the nesting trend, homeowners are spending more money on high-end kitchen appliances such as Wolf gas ranges, says Haralambides, whose firm recently sold every available property in its Canal Grove subdivision in Perinton, along the Erie Canal path.
 
Master bathroom tubs have become less popular simply because they gobble up square footage, though most clients still want a tub in their second bathroom, he says. Interest in high-quality bathroom tile, glass panels and body sprayers has risen, as has demand for horizontal fireplaces in living areas. Granite remains the most common kitchen countertop material at Aristo-built homes, followed by quartz.
 
In general, oversized rooms "have been toned down a bit," especially when the homeowners are baby boomers, Haralambides says.
 
Challenges related to fine homebuilding range from material costs to staying on schedule. Property taxes also can reroute plans.
 
One client who recently hired Aristo to build a year-round 4,300-square-foot home on Canandaigua Lake would have considered going as large as 5,000 square feet, "but from the standpoint of taxes, it made absolutely no sense," Haralambides says.
 
Prices for petroleum-based products such as roofing and siding rise every six months, he adds.
 
Still, the outlook for the local fine home market seems positive.
 
"So I'm really excited," Morabito says.
 
Sheila Livadas is a Rochester-area freelance writer.3/29/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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