Recently I received a newsletter from a well-known investment company featuring an article entitled, “Bad Loans Are Made in Good Times.” It was an overview of the dip in returns investors might now be experiencing as a result of the tightened housing market. Tightened, however, is relative.
We are not experiencing too few homes on the market—it isn’t a market crunch. I know of one market that has a 2 1/2 year supply of homes in the $500,000-plus category. Rather, the tightening is of the lender requirements so that fewer people can qualify for loans. Lenders (and, consequently, their investors) have been badly stung by enthusiasm for and the pushing of products such as the now infamous ARMs (adjustable rate mortgages). Lenders have been left holding a record number of defaulted loans as the interest rates rose in the stipulated time frame, and many former homebuyers could not re-qualify for refinancing nor could they afford payments that rose $400 to $1,000 higher as the rate inevitably adjusted.
It’s a great time to buy a repossessed home—if you can qualify for it. But the bottom-line result is a tightened housing market.
BAD NEWS, GOOD NEWS
Ironically, this sad scenario may be a boon to the home furnishings industry. Now that the housing market is doing so poorly, many homeowners are not looking for new homes. Rather, they have decided to stay put; investing their money instead into making their homes into lovelier places to live.
This plan may appeal to many of your customers, and what better time to plan for a lovelier environment than during the end-of-year holidays? Assuming the time deadline for holiday celebrations cannot possibly be met (that deadline likely was months ago!), then it is a wonderful Happy 2008 gift to oneself. It is a perfect way to cheer up at the first of the year by bringing your clients only the best.
PSYCHOLOGY FIRST; HIGH QUALITY ALWAYS
For bringing this best-quality-only approach to your decorating customers, there are some tips for encouraging new sales through high-end psychology. Here are a few worthy suggestions:
• Tip 1: We are living in a time when luxury has become affordable, attainable and expected in a relatively healthy economy. No longer do many homeowners feel guilty for wanting great quality. They seek it and are pleased, even proud, about it.
Make this assumption: customers want to attain a luxurious space for themselves and those they love. Everyone wants to believe he or she deserves a bit of luxury.
• Tip 2: Always start with the products and features that enhance ease-of-use and aesthetics. Once customers have seen top-of-the-line beauty and quality, coming down to lower quality is difficult. As they see the value of higher quality products, they often can find a way to afford it rather than buy down. Never show economy first; always show the best first and work on selling it. Assume and believe this is what they desire.
• Tip 3: Remember features and benefits in all sales presentations. If a feature is indeed easier to use—such a motorization, for example—then the benefit to the customer is a luxury that frees them of tedium and allows them to cover out-of-reach windows. Another benefit is light and glare control and increased privacy at all windows. This results in yet another benefit, which is peace of mind.
• Tip 4: Higher quality almost always means lower upkeep for the long run. For those who are investing in their present homes, there is a good chance they have made the decision to stay put for several years to come. If home furnishing products have lower incidence of malfunction, then this means freedom from breakdown. The fear that a product will break is something that should not have to concern customers. That means fewer headaches and frustrations for them and for you.
• Tip 5: Only the best in window treatment products will complement the high quality in many interiors today, regardless of the style preference of the homeowner. For example, if a customer has invested somewhere between $11,600 and $15,100 in an authentic Knoll (KStudio) Barcelona Couch by Mies van der Rhoe (as seen in the photograph; also www.knoll.com/products/pricelists/KStudioLoungeSeating), then window coverings should be commensurate in quality, keeping the same company as high-quality mid-century classic furnishings.
• Tip 6: Stress timeless elegance as a payback for the investment in higher quality. High-quality design does not necessarily peg a particular style or period. It belongs to each and every style. However, if there is a major trend, it is toward a softer, understated appearance—a middle ground between very cold modern and elaborate historic styles. Many contemporary timeless interiors have fewer furnishings but with an emphasis on high quality and long-lived high appeal of each and every item.
Many consumers are open to the idea of creating interiors that are high-end with the best designs, best products. Many people respond well to exceptionally gorgeous furnishings. Most don’t know how to create that special look, but all “know what they like when they see it.” This has been referred to as the do-it-for-me market. It’s made up of customers who want beautiful interiors and want it all done for them so they can relax, regroup, luxuriate, revitalize, romance, enjoy and feel refreshed in they own best space.
Enjoying one’s home is a major, long-lived trend. A home that is beautifully appointed, perfectly proportioned and well kept (clean and orderly) is a delight to the eye and to the senses.
Take the opportunity as an experienced professional to enhance customers’ everyday living by offering upgraded fabrics, both standard and specialty hardware and accessories in lustrous finishes such as gold, silver or bronze accents. Understated elegance, classic beauty and distinctive design complement the most exquisite homes, and every customer wants that home.
Karla J. Nielson, Allied ASID, WCAA, is assistant professor of design at Brigham Young University. She has authored several books including Window Treatments, Understanding Fabrics and Interiors: An Introduction, 3rd Ed. Nielson is a regular correspondent for Draperies & Window Coverings addressing the areas of fashion, education and merchandising.