Keep, Stop, Start: Selling New Homes in a High-Rate Environment

Keep, Stop, Start: Selling New Homes in a High-Rate Environment


In July, 85% of prospective new home buyers we surveyed said they would not buy a home if mortgage rates exceeded 6%.1 Here are some design and marketing tips on what to keep, start, and stop doing to increase demand.

Keep: Strategically shrinking square footage to get costs down.

To balance affordability with demand for greater function within the home, designers are thoughtfully “right sizing” rooms and spaces to ensure that all needs are met.

Interior spaces that square footage is most often reallocated from include:

  • Offices – A bedroom-sized home office is no longer the norm, with an increasing number of designers including pocket-sized office spaces. Homeowners and single-family renters support this tradeoff, with up to 86% of Young Families preferring to downsize the office and use the remaining space elsewhere in the home.2 (NHTI Members – click here for a curated selection of examples).
  • Kitchens – Two separate panels at our 2022 New Home Trends Summit suggested kitchen islands with seating in lieu of a separate breakfast nook. Our survey results reflect the same sentiment, with 85% of homeowners willing to make this space-saving tradeoff (see last month’s article for an example).3
  • Primary bedrooms – Primary bedrooms are not shrinking, but they are getting an extra infusion of function. A greater number of designers now include primary bedroom retreats. These inherently private spaces (by nature of being placed in the primary bedroom) also make great workspaces.
Splash at One Lake is a cluster project, and the most attainable opportunity in the community. Generously sized main bedroom suites (approximately 21.5’ x 20’) have the potential for greater function with a built-in desk, should the downstairs den not suffice.

Stop: Saving money by excluding memory points. 

Without the draw of short-term investment potential, the importance of the emotional appeal of a new home rises. Almost two-thirds of homeowners feel a deep emotional connection to their current home, so it will take a strong emotional connection for them to move.4 This means focusing physical sales tools more on spaces that resonate, and less on statistics and building science (which are still important but should be featured on your website). Memory points do not have to be large to be differentiators. Think about cozy spaces (nooks, niches), superb function (smart storage, workspaces), and outdoor connection (private deck, firepit).

California Design Consultants merchandised the secondary bedrooms at Acacia with a window seat, which accomplishes all three objectives above: (1) the cozy niche uses space that would otherwise be left over, (2) the drawers add storage, and (3) the large window adds connection to nature.

Start: Focusing on the long-term investment potential of buying a home. 

Per our survey results, “Good investment/means of building wealth” is the number one reason consumers value homeownership.3 64% also agree that purchasing a home is typically a better investment than the stock market. Keep consumers focused on the long-term investment benefits of homeownership, especially noting the advantages of controlling your monthly payments and having the option to refinance if rates decline in the future.

To learn more about the tradeoffs consumers are willing to make, become a member of the New Home Trends Institute today!


1 New Home Trends Institute by John Burns Real Estate Consulting, LLC survey of 1,347 US homeowners and renters age 18+ with household income of $50,000+. Survey fielded July 12–17, 2022.

2 New Home Trends Institute by John Burns Real Estate Consulting, LLC September 2022 survey of 1,299 US homeowners and single-family renters with household income of $50,000+.

3 New Home Trends Institute by John Burns Real Estate Consulting, LLC survey of 1,347 US homeowners and renters age 18+ with household income of $50,000+. Survey fielded July 12–17, 2022.

4 New Home Trends Institute by John Burns Real Estate Consulting, LLC June 2021 survey of 1,242 homeowners with a net worth of $100,000+ (excluding those who never plan to move).

Anja Seng Anja Seng, Senior Research Analyst