Small-Space Living: A Big Opportunity

This is the second installment of a special series, presented by the National Hardware Show, exploring key trends and developments driving the growth of housewares and home goods in the home improvement retail business.

The small-space living trend has been hailed by the homewares industry as the Millennial/Baby Boomer tie that binds. One is aging into homeownership looking for starter homes and access to urban markets; the other is experiencing “empty nesting” and looking to downsize.

As such, small-space lifestyles have impacted product development, marketing and merchandising across a number of homewares categories, including home organization, furniture and kitchenware.

Here are key housing, demographic and design trends to consider:

  • Housing market trends point towards an uptick in smaller housing after years of decline.
    According to the Census Bureau, new single-family houses less than 1,400 square feet that were sold in 2017 rose from 17,000 to 21,000. Single-family homes between 1,400 and 1,799 square feet that were sold in 2017 rose from 79,000 to 90,000.
    The National Association of Home Builders, meanwhile, said townhouses, after declining during the last recession, have grown to account for half of single-family home starts during the past year-plus.
  • Millennials remain a powerhouse in terms of buying potential within the housing market, but the group overall has not settled into smaller, urban apartments as readily as was previously expected.
    “We are seeing that Millennials and first-time homebuyers are actually both being pushed to the suburbs because they offer more affordable properties,” said Jessica Lautz, director of demographics and behavioral insights, National Association of Realtors. “We do see first-time home buyers are typically purchasing a single-family detached home. It might be a little smaller, but it is a very traditional home,”
  • Market research firm The AIMsights Group reports 42% of all homebuyers are Millennials, 31% are Generation X; and 16% are Baby Boomers. Homebuyers are also home renovators, with 73% of buyers renovating.
    According to the Joint Center For Housing Studies at Harvard (JCHS), after a decade of soaring rental demand, growth in renter households slowed from 850,000 annually on average from 2005 to 2015 to just 220,000 from 2015 to 2017. Owner households rose 710,000 annually on average in the past two years.
  • The “Silent Generation,” ages 72 to 92, may be the demographic to watch. Lautz, of the National Association of Realtors, said, “What I find interesting is that the oldest generation is purchasing single-family detached homes at lower rates, and they are purchasing condos and townhouses at higher rates. They want a smaller space and are not wanting the upkeep of a larger home.”
  • Small-space living has inspired consumers to think about flexibility, efficiency and lifestyle compatibility. “We know that people are looking for a more flexible, fluid home that can adapt to different use,” said Janice Simonsen, spokesperson for home furnishings superstore chain Ikea. “For example, a table might serve as a work-from-home desk during the day, a desk for homework for children in the afternoon and expanded for use as the family dinner table in the evening.”
  • Stuart Harvey Lee, founder and creative director of design firm Prime Studio, said small-space living encourages product developers to consider multipurpose items, but they should do so with restraint. Lee said consumers who deal with small-space issues often respond to everyday items that effectively complete a task more easily, and he added consumers also demonstrate a greater willingness to try out new materials if they contribute to efficient space use.
  • Designer Steve Cozzolino of Cozzolino Studio cautioned against “feature creep” and the temptation in product development to layer on additional functions. Adding features may satisfy a marketing ambition to promote lots of product uses for the price, but it also can result in poor performance and, critically today, negative online reviews.
  • Jason Belaire, executive director of Denver Design Week, said Millennials are unique in that they’ve grown up focused on sustainability and social issues that concern the environment. As such, he said, products that use space, power and materials in lesser proportions are likely to attract them.
  • Max Burton, global leader of connected products at Fjord and founder of design firm Matter, said products designed to accommodate smaller spaces should address storage space scarcity and a likelihood that functional products may need to remain in plain sight. “A lot of people can’t install beautiful storage to hide things,” Burton said. “That should make designers think more about aesthetics.”

The tiny living way of life is coming to the 2019 National Hardware Show. Tiny Living @ NHS, featuring Small Build & Construction Technology Conference, is designed specifically for professionals in the small living, modular and manufactured housing industries. Open to all builders, developers, product/service providers, government officials, retailers, non-profits and other real estate professionals, it is the only event with an added feature of being able to network with over 30,000 hardware, building supply and other industry professionals. Walk the Show Floor and discover companies that specialize in products and services, within all of the current NHS product categories, focused on tiny living needs and trends.

The Small Build & Construction Technology Conference will include two full days of seminars on the most relevant topics impacting the industry today and networking with the world’s leading professionals in this market segment. The two-day conference will feature a mixture of interactive panels covering topics such as flat-pack housing, 3D Printing, Hemp Crete Housing, Building tiny house communities, The Modular Movement and more. You don’t want to miss out on the chance to learn all things trending around the Tiny Living movement while experiencing the latest innovations and product launches from the largest gathering of product and service providers under one roof.

Click here to learn more about the Small Build & Construction Technology Conference at the 2019 National Hardware Show.