Bob Mirman, formerly a clinical psychologist, knows what makes people tick. Today he puts the home buying public on his couch. What people want in their homes, and why.

 

He is able to listen well, draw out homebuyers and put the results into data that homebuilders can use over the next decade. “We take a look at what people are saying now and predict what the trends are going to be,” Mirman says. And what he sees today is revealing: The home of the 21st century – the one going up today – is equal measure personal taste and a reflection of society as a whole.

 

As founder and president of Irvine-based Eliant, Mirman oversees 14 full-time employees at his rapidly expanding consumer research company, which has a heavy focus on the homebuilding industry through surveys with homebuyers and experts in the field. Its motto; “The eyes and ears of the building industry.”

 

Mirman is often referred to as the “consumer trends guru.” Mirman began his career working in schools, clinics and state hospitals. He started focusing on his current work in 1977. For seven years, he was director of performance systems for General Mills Inc., directing the development of employee opinion and customer perception surveys in the United States and Canada.

 

His client list today includes more than 75 homebuilders. A majority of Orange County builders have used his company at some point. From surveying more than 100,000 new homebuyers, he has determined buyers’ tastes and demands, identified trends, developed annual homebuyer satisfaction surveys and used his knowledge as a columnist and speaker within the homebuilding industry. In fact, his predictions reflect those of thousands of homebuyers who have told builders, through him, “Listen guys, you’ve got to make it more unique so I know where I am, so I feel like it’s my house…”

 

As Mirman explains: “They’re going to work there more often, in their home office, they’re going to telecommute, and they’re going to come home and not just fall asleep in front of the TV mindlessly anymore.” What homebuyers want most is a personalized home with an assortment of options to choose from to make that house a home. In no place is that message louder than in Orange County. Mirman, who conducts focus groups around the country, believes the country’s homebuyers are the most sophisticated he has faced. “The people here are shoppers; they’re educated shoppers. They are very smart, very articulate…this is a tough marketplace and as a result, the builders have to be tough. They have to be creative. They have to be responsive.”

 

Mirman, 53, lives in Laguna Niguel with his wife Perri, and two sons, Nicky, 8, and Max, 6. A daughter, Alexis, who is 21, graduates from Northwestern University this month.

 

Mirman met with OC METRO Executive Editor Craig Reem. His recipe for a winning combination? “Offer function and aesthetic charm at the same time.” Following are excerpts.

 

OC Metro: What are the trends you see in homebuilding?

 

Robert Mirman: The hottest issue these days for builders and consumers is this whole idea of customization. It’s the primary driving force for a lot of buyers being in this market.

 

OC Metro: It’s not so much that they want to buy a new home; it’s that they want to buy their dream home?

 

Mirman: It’s the difference between a buyer who says, “I’m willing to buy a resale home and maybe add some things to it and remodel” versus a buyer who says, “I want to build a custom home, but can’t afford a custom home, but I will buy it from a new homebuilder who will allow me to customize the home, so when I move in, it already says, this is my home.”

 

OC Metro: What’s the true ambition to that?

 

Mirman: Why is it so powerful a driving force? Why are we motivated by that? That’s a complicated answer. Part of the root of that is what we’ve been through in California over the last five or six years. And the fact that it was tough. There weren’t very many houses being built and sold; people were taking a long time to make a decision, so people were staying in their houses longer, and putting up with what in many cases were older designs…Now the market is coming back, housing is improving, equity is improving…people are saying…I want what I want, and I’m not going to put up with anything less. So they’re more demanding, they’ve been looking for years, so they know what’s available. They know what they like, what they don’t like.

 

OC Metro: So they’ve been educating themselves as they’ve sat at home for the last five to six years.

 

Mirman: This is not a stagnant consumer group. (Mirman later says that his research shows a new-home buyer visits an average of 18 homes before choosing.) During the time we were in a recession, the remodeling industry was in a boom. People couldn’t afford to move, they didn’t have enough equity to move…and people learned about product, about price, about value and what was out there. And the more they demanded, the more manufacturers started coming up with new things, new ways, new products, new floorings, and new windows. All these new things that people now are finding they want in their next home. Now they are looking for homes and they are not going to settle for what they might have settled for seven or eight years ago. Now they want more…and homebuilders are much more responsive. (For example) people now expect things that five years ago they may have looked at as being optional. A home office is a requirement. Builders this day and age, particularly in California, cannot get away without merchandising or demonstrating an office setup in a model home. Because of this move toward personalization, this move toward custom, it’s almost as if we don’t have production builders anymore. We have what I call custom production builders. And that’s what buyers are really demanding. Builders are doing different elevations, not a homogeneous look but a heterogeneous look. Different elevations, different color of paints…different street scenes.

 

OC Metro: Someone mentioned the other night at one of your focus groups that they want something that nobody else has on the block. A uniqueness.

 

Mirman: Uniqueness was the driving force of this whole personalization. We started seeing that in our VISION survey; we used to ask how important each of these issues is to your purchase decision. Uniqueness of the home, when we first started doing this in ’91, was pretty low – it wasn’t at the bottom, but a mid-range number. But that number every year has increased. That was one of the driving forces for options and personalization.

 

OC Metro: In your VISION survey, is uniqueness now a yes response by more than 50 percent?

 

Mirman: We didn’t even ask it this year, it’s so obvious…the other driving force is the fact that a large proportion of people intend to spend a lot of time in their homes in two ways” One is the duration of time they expect to spend; it’s over 10 years (Mirman says this number is going down from a high of 13 years as investment scenarios once again play a part in home buying and selling). In 1991, the first year that we did that survey, it was six years…. The other is how much time will we spend in our homes today? If I have an office there, a bonus room, and secondary bedrooms are bigger to accommodate my long-term growth, I have more potential to spend time in my home. It’s not just a place to come into and check in at night anymore. I want this home to be me; it’s got to reflect my personality. I don’t want to buy a house that looks like the guy’s next door.

 

OC Metro: What is the rationale of wanting to stay in the home for 10 years.  Family?

 

Mirman: Family is an issue, but primarily it’s driven by investment. If housing prices continue to go as they are right now, and we get closer to the scene that we had in the late ‘80’s – and we’re a long way from that now – then the number will continue to drop. There will be a higher proportion of people who will look at a house purchase as being an investment-driven strategy…. But we’re still a long way from that. The housing market is still in its infancy stages of this boom.

 

OC Metro: House hunters, those looking for short-term investments, are not really good for the market, are they? Don’t they artificially run up the price?

 

Mirman: Yes, but it’s inevitable; there’s no control for that. (Mirman notes that builders could work against this trend by holding pricing down, but that goes against making a profit when the market is hot.) Builders know that a market works in cycles, and they know they have to make their profit in the up cycle because they get burned in the low cycle.

 

OC Metro: How far are we into this up cycle? And how long will it last?

 

Mirman: We’re just getting started. I think it’s going to go three, four or more years on the up. I don’t see anything in the economy which suggests to me that we’re anywhere close to establishing a halt on this. All the figures look good; for the first time in a long time all the numbers in the economy look good.

 

Unemployment, consumer confidence, interest rates are low….

 

OC Metro: Homebuilders, can they keep their prices steady? Phases are opening and each one is now selling for significantly more that the previous ones.

 

Mirman: That’s the reality of the homebuilding business. You can say it’s unfortunate, but the demand is so strong. (However), homebuilders face the risk of …upsetting this balance in terms of the relationship between consumers and builders by increasing prices too quickly. If they do that, the people who are waiting in lien now to buy in the next phase, when they get to the next phase and the builder announces the price increase, they’re losing a proportion of those people who now cannot qualify at that price, or who are no longer interested for whatever reason. And they are angry about that.

 

OC Metro: And the danger for the homebuilder is the grudge lasts for the next three or four home buying experiences.

 

Mirman: Unfortunately, it’s the hard reality of this business. It’s a tough business to make money in. The margins for homebuilders used to be in double digits, they’re way down in the single digits now…I don’t want to say that they’re trying to make it up now by just pushing all these buyers now to make up for what they lost. But it just costs more to build a home these days: all this customizing and the time it takes to do that, and the sophisticated nature of the homebuilding process. (And) land is more expensive these days.

 

OC Metro: What are the most important things people look for in homes today?

 

Mirman: The first thing people look for in their home is not in their home, it’s what surrounds them. It’s got to be safe; it’s got to be convenient. It’s got to be a neighborhood. They want amenities close by; they want to know that their kids can walk to school or bike to school or at least take their bike down to the playground or community pool…Buying a new home these days is not just buying a house, buying a structure, it’s buying a place to live – that’s way beyond the walls. So where I live is more important that what I live in. The rest of the stuff follows from that and has to meet the lifestyle.

 

OC Metro: Any clue 10 years ago, when you started the surveys that you would be talking about homebuyers’ savvy, homebuilders’ response, and customization?

 

Mirman: Not to the degree we have today. When I first started doing this in 1988, volume, and number of sales was the key. Builders didn’t care; (buyers) didn’t care either. They just wanted to get into their house…that was truly ‘build it and they will come’ days. Well, that’s changed.

 

OC Metro: What do you foresee in homebuilding trends five to 10 years for today?

 

Mirman: A lot of the design that homebuilders are going for is driven by technology that we’re offering…in the whole aspect of people spending more time working in their homes and playing with these toys, and learning how to use these technologies to their betterment and to their amusement and to their work. Builders are starting to attend to the fact that they have to design the homes not just to be functional…you have to consider the design around the technologies that the whole family is using.

 

OC Metro: How does this fit with the personalized home of today and tomorrow?

 

Mirman: The underlying factor on options and personalization and this custom production mode is just one more thing that people are trying to do to take control over their lives. In part that’s because of the recession; in part it’s because we have less faith in all these people that we’ve had faith in before, that we were raised to believe in…Therefore, we’re taking more control to make up for that loss. There’s an underlying psychological factor in this. It’s part of the growing entrepreneurial spirit in this country…you can control the space around you, not just the temperature, but the way it looks, the design of the home.

 

OC Metro: So if I ask you if homebuilders are building homes for the 21^st century, you’ll tell me they are?

 

Mirman: Clearly they are. We’re scratching the surface. Homebuilders are just beginning now to understand what that means, to build for the next century.

 

OC Metro: In 10 years, the oldest baby boomers will be 62, at or near retirement age. What is the impact? Will they be moving their aging parents in with them?

 

Mirman: First of all, right now, there is a significant number of people in their 40s and 50s who are buying homes with the intention of moving their parents, in the next 10-20 years, (in with them). They’re buying homes with that thought in mind.

 

OC Metro: Having said that, what are buyers demanding of builders?

 

Mirman: You need a downstairs space for your parents to move into, and a downstairs space for you to move into when can’t climb the stairs. In (a recent focus group), I said “How many of you buying a home are considering that your parents or some other relatives who are older or infirm may move in with you in the future,” and four out of the 10 said they were consciously thinking about that.