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2006 Builder Insights
A multiclient FROM PARKS ASSOCIATES
By Bill Ablondi, Director, Home Systems Research

Publish Date: May 06

SYNOPSIS

Research, Analysis, and Forecasts of Consumer Electronics Sold through Homebuilders

2006 Builder Insights is a comprehensive assessment of home builders as a channel to consumers for more than 20 categories of upscale appliances and electronic systems. The analysis and forecasts prepared in this study are based on a national survey of 1,155 builders and numerous case studies of builders who sell electronic systems and those who don't, meshed with Parks Associates extensive, ongoing home systems research and analysis.

The research probes builders' opinions on the amenities that sell homes, their image of specific brands, and the margins earned from the products they install. It explores how builders select their vendors and installers, what builders want from manufacturers to help sell their systems, how builders market technology amenities, and the factors builders see influencing home buyers' decisions about the upgrades they choose.

“Interest rates are up, unsold inventories are high, and competition among home builders is heating up,” said Bill Ablondi, director of home systems research for Parks Associates. “For years, builders have emphasized amenities like larger kitchens, bigger closets, and elegant master baths. But in this digital era, lures will include multiroom audio, home theater, security systems, and structured wiring, all of which appeal to the new ‘iPod Generation’ of home buyers.”

Download PDF of Table of Contents | More Information on the 2006 Builder Insights

CONTENTS
The Bottom Line

1.0 Notes on Methodology
   1.1 Survey Overview
   1.2 Survey Topics
   1.3 Respondents

2.0 Builder Attitudes about New Technologies

3.0 Products Offered and Installed

4.0 Home Buyer's Cost and Builder's Margin for Selected Products

5.0 Builders' Vendor Selection Criteria

6.0 Builders' Sales & Merchandising Activities

7.0 Brand Image among Builders

8.0 Probes into Specific Product Categories
   8.1 Upscale Appliances
   8.2 Central Vacuum Systems
   8.3 Structured Wiring & Pre-wiring Options
   8.4 Security Systems
   8.5 Home Control Systems
   8.6 Multiroom Audio Systems
   8.7 Home Theater Systems
   8.8 Communications/Intercom Systems

9.0 Forecasts of Sales of Selected Product Categories through New Home Builders
   9.1 Structured Wiring Systems
   9.2 Security Systems
   9.3 Central Control Systems
   9.4 Multiroom Audio Systems
   9.5 Home Theater Systems

Resource Book

1.0 Survey Overview & Respondent Profile
   1.1 Survey Overview
      1.1.1 Survey Topics
   1.2 Respondent Profile

2.0 Technology Products Offered by Builders
   2.1 Builders' Attitudes about Technology Products
   2.2 Products Offered
   2.3 Vendor & Installer Selection Criteria
   2.4 Source of Products
   2.5 Builders' Sales and Merchandising Activities for Technology Products

3.0 Probes into Specific Product Categories
   3.1 Appliances
      3.1.1 Central Vacuums
   3.2 Low Voltage Pre-wiring & Structured Wiring
      3.2.1 Pre-wiring Options
      3.2.2 Structured Wiring
   3.3 Security Systems
   3.4 Control Systems
      3.4.1 Multi-zoned HVAC Systems
   3.5 Entertainment Systems
      3.5.1 Multiroom Audio
      3.5.2 Home Theaters, Media Rooms and Entertainment Centers
      3.5.3 Built-in Communication/Intercom Systems

figures
The Bottom Line

Product Categories Covered in 2006 Builder Insights Survey of Home Builders
Number of New Residential Units Started by Builders Responding to the 2006 Builder Insights Survey: Completes vs. ALL Respondents
Builders’ Attitudes about Offering New Products
Technology Amenities Offered and Installed by Builders (1 of 3)
Technology Amenities Offered and Installed by Builders (2 of 3)
Technology Amenities Offered and Installed by Builders (3 of 3)
Percentage of ALL New Homes Sold in 2005 with Selected Amenities (1 of 3)
Percentage of ALL New Homes Sold in 2005 with Selected Amenities (2 of 3)
Percentage of ALL New Homes Sold in 2005 with Selected Amenities (3 of 3)
Average Home Buyer Cost and Builder Margin for Installing Selected Amenities)
Factors Builders Consider Most Important when Selecting Manufacturers of Home Entertainment Systems
Importance for Manufactures to be on Builders' Approved Vendor List
How Builders Present Home Technology Options to Home Buyers
Brands with BEST OVERALL Technology Image among Builders
Builders' Rating of Selected Brands on technology Image (1 of 2)
Builders' Rating of Selected Brands on technology Image (2 of 2)
Builders' Rating of Selected Factors on Likeliness to Positively Influence the Sale of a New Home (1 of 2)
Builders' Rating of Selected Factors on Likeliness to Positively Influence the Sale of a New Home (2 of 2)
How Builders Think Structured Wiring Manufacturers Can Improve as Partners with Builders
Components Typically Installed with Security Systems
Additional Equipment Offered by Builders with the Security Systems They Install or Arrange to Install
Functionality of Home Control Systems Installed by Builders
Levels of Multiroom Audio Systems Offered by Builders and Percentage of Buyers Choosing the Level if Offered
Electronic Components for HOME THEATERS Builders Offering Them Typically Install or Arrange to Install (1 of 2)
Electronic Components for HOME THEATERS Builders Offering Them Typically Install or Arrange to Install (2 of 2)
Communications/Intercom Systems: Split Between Telephone-Based, Traditional Dedicated, and Integrated Systems
Residential Housing Units Started, Built and Sold: 2003 to 2008
Market Value* of Low-voltage Wiring & Electronic Amenities Sold in New Single Family Residences
Market Value of Structured Wiring Systems Installed in New Residential Construction
Market Value of Security Systems Installed in New Residential Construction
Market Value of Central Control Systems Installed in New Residential Construction
Market Value of Multiroom Audio* Systems Installed in New Residential Construction
Market Value of Home Theater Components Installed in New Residential Construction

Resource Book

Types of Businesses in Which Respondents are Engaged
Respondents’ Primary Job Function
Breakdown of Builders By Number of New Starts in 2005
Number of Years Builders’ Firms Have Been in the Home Building Business
Percentage of Homes Started in 2005 that were CUSTOM
Percent of Homes Started in 2005 that were CUSTOM vs. Number of Starts
Breakdown of Single-family Homes Started in 2005, by Type
Percentage of Homes Started in 2005 by Type
Breakdown of Single-family Homes Started in 2005 by Category
Percentage of Home Started in 2005 by Category
Percentage of Homes Started in 2005 that were in Master-Planned Communities
Percentage of Homes Started in 2005 that were in Master-Planned Communities
Average Selling Price to Occupant of Homes Built
Average Price to Occupant of Homes Built
Average Finished Area of Home Started in 2005
Average Finished Area of Home Started in 2005
Builders’ Geographic Scope of Operations
Builders’ Geographic Scope of Operations
Regions in Which Builders are Actively Starting Homes
Regions Builders Actively Building Homes
Builders’ Estimated Revenue Derived from Residential Units Started in 2005 and Expected from Units Started in 2006
Builders’ Estimated Revenue Derived from Residential Units Started in 2005
Builders’ Expected Revenue Derived from Residential Units to be Started in 2006
Builders’ Most-Useful Sources of Information About Products, Technologies and Features to Include in Homes
Organizations in which Builders are Members and Active
Trade Shows Attended in 2005: by Number of Starts
Trade Journals Read Regularly: by Number of Starts
Builders’ Attitudes About Offering New Products
Builders’ Attitudes About Offering New Products
Percentage of Builders with Dedicated Technology Assessment Resource
Who is Responsible for New Technology Assessment?
Which Technology Amenities Are Offered and Installed?
Which Technology Amenities Are Offered and Installed?
Which Technology Amenities Are Offered and Installed?
The Influence of Technology Amenities
The Influence of Technology Amenities
The Influence of Technology Amenities
Percentage of Builders Partnering with Service Firms to Receive Payment for Signing up Home Buyers
Importance of Factors When Homebuyers Consider Upgrades
Amenities Most Likely to Positively Influence Sale of Home
Amenities Most Likely to Positively Influence Sale of Home
Percentage of Builders Choosing Manufacturers on National, Regional, or Local Basis
Importance for Manufacturers to be on Builders’ Approval Vendor List
Importance of Selected Criteria to Builders When Choosing Manufacturer of Home Technology Products
Importance of Selected Criteria to Builders When Choosing Manufacturer of Home Technology Products
Importance of Selected Criteria to Builders When Choosing Manufacturer of Home Technology Products
Importance of Selected Criteria to Builders When Choosing Installer of Home Technology Products
Importance of Selected Criteria to Builders When Choosing Installer of Home Technology Products
Builders’ Preferred Sources of Non-Structural Products (e.g. appliances or entertainment equipment)
Reasons Builders Selected Most-Preferred Source of Supply for Non-Structural Products
Are Builders Open to Different Sources For their Non-Structural Products?
Why Builders Would Consider Different Source of Supply for Non-Structural Products?
How Are Home Technology Options Presented to the Buyer?
Builders’ Roles with Respect to Recommending or Selling Consumer Electronics and Other Equipment
Builders’ Most-Preferred Means of Sales Support for Technology Products in Model Homes or Selection Centers
Builders’ Least-Preferred Means of Sales Support for Technology Products in Model Homes or Selection Centers
How Do Builders Monitor Traffic in Model Homes?
Where Would Builders Demonstrate Home Computers?
Do Builders Use Market Research?
Builders’ Top Four Sources of Market Research
Builders’ Acceptance of Research from Manufacturers vs. Independents
Focus of Research Commissioned by Builders
Brands with Best Overall Technology Image – Unaided
Brands Overall Technology Image – Unaided
Builders’ Rating of Selected Brands on Technology Image
Builders’ Rating of Selected Brands on Technology Image
Builders’ Role with Respect to Appliance Selection
Top Ten Appliance Brands that Come to Mind
Top Ten Premium Appliance Brands That Come to Mind
Appliance Brands Builders Would Not Consider Offering
Do Premium Appliance Brands Increase the Value of a Home?
Builders’ Rating of Selected Factors on Likeliness to Positively Influence Sale of Home
Builders’ Rating of Selected Factors on Likeliness to Positively Influence Sale of Home
Builders’ Rating of Selected Brands on Likeliness to Positively Influence Sale of Home
Builders’ Rating of Selected Brands on Likeliness to Positively Influence Sale of Home
Builders Rating Likelihood of Selling Selected Brands Currently Compared with Year Ago
Are Home Builders Offering Smart Appliances, Capable of Being Monitored by an Energy Utility?
Why Builders Offer Interfaces Allowing Electric Utility Companies to Monitor and/or Control Them?
Are the Central Vacuum Systems Standard or Optional?
Top Ten Most Widely-Used Central Vacuum Brands
Why Do Home Buyers Choose Central Vacuum Systems?
Percentage of Builders’ Agreeing with Statements about Central Vacuum Systems
Percentage of Builders’ Agreeing with Statements about Central Vacuum Systems
What Would it Take for Builders to Offer Central Vacuum Systems as Standard Features?
Would Builders Consider Installing Central Vacuum Systems?
Price Builders Charge to Add a Central Vacuum System
Typical Margin for Central Vacuum Systems
Percentage of Builders Offering Selected systems in Addition to Central Vacuums
Average Finished Area of Homes with Central Vacuum Systems Installed
Why Don’t Home Buyers Choose Central Vacuums?
Do Builders Offer Low Voltage Pre-Wiring Options?
Types of Low Voltage Wire Installed by Builders and Percentage of Homes Wired with Each
Pre-wiring Applications Offered and Percentage of Home Installed with Each
Pre-wiring Applications Offered and Percentage of Homes Installed with Each
Percentage of Starts Builders Think Will Be Pre-wired for Selected Applications in Five Years
Percentage of Builders Agreeing With: “The Sale/Resale Value of a newly built house increases if it is Pre-wired for…”
Do you agree with this definition?
Is Structured Wiring Offered as Standard or Optional?
Percentage of Homes Sold with Structured Wiring that Are Sold with an Upgrade to a Basic Package
Average Cost to Buyer for Installing Structured Wiring
Average Amount Buyers Paid for an Upgraded Structured Wiring Package
Cost of Structured Wiring Compared to Regular Pre-Wire
Cost Increases for Installing Structured Wiring
What Premium do Builders Add to a Home Cost When Structured Wiring is Installed?
Average Number of Rooms with Structured Wiring Terminations
Location of the Structured Wiring Panel
Applications Supported by Structured Wiring Systems
What Applications Drive Buyers to Accept a Structured Wiring Solution?
Builders’ Level of Agreement with Statements Related to Structured Wiring
Do Builders Offer Home Buyer Training on Use of the Structured Wiring System?
Top Ten Most Widely-Installed Structured Wiring Brands
Most-Important Resources in Determining Which Specific Structured Wiring System to Use
How Can Structured Wiring Manufacturers Improve?
Have Builders Experience Customer Service Issues Related to Structured Wiring Installations?
Home Builders': How Important is it for Structured wiring Vendors to Supply the Following Sales and Marketing Resources?
Which One Company Has the Most Complete Residential Structured Wiring Program?
Why Builders do NOT Offer Structured wiring
What Types of Security Systems are Installed?
Are Security Systems Offered as Standard or Optional?
Technologies Employed in Security Systems
Why do Home Builders Offer Security Systems?
Typical Home Security Components Installed
Additional Equipment Offered with Security Systems
CCTV Cameras Sold
Do Home Builders Receive a Home Security Sign-up Fee?
Average Buyer Cost for Security Systems
Typical Home Security System Margin
Top Ten Most-Widely Offered Brands of Security Systems
Who Determines Which Specific Security System to Install?
Would Builders Consider Offering a Security System Solution from a National Cable Communications Provider?
Importance of Selected Purchase and Brand Criteria to Builders When Choosing Products
From Where is the Security System Hardware Acquired?
Why Builders Do NOT Offer Security Systems
Functionality of Home Control Systems Installed by Builders
Importance of Selected Systems to Builders Considering Adding Systems
Top Ten Most-Widely Installed Brands of Control Systems
Other Brands of Control Systems Installed
Does Consumer Demand Exist for Home Control Systems?
Why are Home buyers Interested in Home Control Systems?
Would Builders Consider partnering with a National Cable Communications Company to Offer Home Control Systems?
Are Builders Interested in a PC-Centric Home Control System?
Average Home Buyer Cost for the Installation of a Zoned Heating and Cooling System
Top Ten Most-Installed Programmable Thermostats in 2005
Do Builders Offer Multiroom Audio Systems?
Are Multi-Room Audio Systems Offered as Standard or Optional?
Which Levels of Multiroom Audio Systems are Offered and Selected?
Why Builders Began Offering Multiroom Audio Systems?
When Did Builders Begin Offering Multiroom Audio Systems?
How Satisfied are Builders with Multiroom Systems?
Marketing/Sales Support Sought from Multiroom Audio Vendor
Percentage of Homes Built with True Multiroom Audio
Average Buyer Costs for Multiroom Audio Systems
What Percentage of Customers ask for Outdoor Audio?
Typical Margin Builders Earn on Multiroom Audio Systems
Premium Charged for Multiroom Audio Installation
Top Ten Most Widely Offered Brands of Multiroom Audio Systems
Other Brands of Multiroom Audio Systems Offered
Builders' Satisfaction with Multiroom Audio Brands
Components of Audio Systems Builders Offering Multiroom Audio Typically Install in a New Home
Importance of Multiroom Audio to Sale of the Home
Why Builders Do NOT Offer Built-in Speakers for Multiroom Audio Systems
Do Homes Include a Dedicated Home Theater Room?
Percentage of Homes with a Dedicated Home Theater Room
Are Homes Pre-Wired for Home Theater/Entertainment Systems?
Percentage of Homes Pre-Wired for Home Theater/Entertainment Systems
What Electronic Components are Installed with Home Theater Systems?
What Electronic Components are Installed with Home Theater Systems?
Top Ten Most Widely-Installed Brands of Home Theater Components
Other Home Theater Component Brands
Average Cost to Buyers for Home Theater Components
Typical Margin Builders Earn on Home Theater Components
What Premium Can Be Charged on a Home Where Home Theater Components Have Been Installed?
Do Homes Include a Dedicated Media Room?
Percentage of Homes with a Dedicated Media Room
Do Homes Include a Dedicated Entertainment Center?
Percentage of Homes with a Dedicated Entertainment Center
For What TV Displays are Builders Pre-Wiring and/or Dedicating Space?
What Percentage of Homes are Sold with Flat-Panel TVs?
How Many Televisions are Sold into New Homes?
Are Built-in Communications/Intercom Systems
Offered as Standard or Optional?
Communications/Intercom Systems: Split Between Telephone-Based, Traditional Dedicated, and Integrated Systems
Percent of Homes Built in 2005 with Intercom Systems

ATTRIBUTES
Authored by Bill Ablondi
Executive Editor: Tricia Parks
Contributors: Kurt Scherf and Yilan Jiang
Published by Parks Associates

© April 2006 Parks Associates
Dallas, Texas 75230

All rights reserved. No part of this book may be reproduced, 
in any form or by any means, without permission in writing from the publisher.

Printed in the United States of America.

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