It wasn’t long ago when the American Dream was envisioned as two people deciding to share a life together, a plan for 2.4 children, some hard-earned savings, the perfunctory two weeks of vacation each year, and last, but certainly not least, a home to call their own. That first home, of course, was usually of the “starter” variety – unadorned, but with plenty of potential for improvement and personalization in the years to come and as the incomes grow.

But who could have predicted what the new American Dream would become?

We now see a mosaic of different types of family and non-family groups, blended households as well as childless-by-choice types, vacations so flexible that they can span from days to months if one saves up the time, and first homes that include a boatload of luxuries that couples use to think it would take decades to acquire.

Have you noticed the number of mega stores solely dedicated to the beautification of the American home that have popped up literally everywhere over the past decade or so? One of the big-box stores even came up with its own “design center,” a mecca for decorating-happy homeowners so that they don’t have to merely envy how the design professionals do their magic – they can actually perform their own sleights of hand with color, texture, appliance, furnishing, or fixture. And for outdoors, there are endless possibilities to extend living space, with inviting outdoor kitchens, unique pool designs, bullet-proof decking choices, courtyards, and stamped-concrete patios that rival those of posh residences.

An article recently printed in BUILDER® Magazine, After the Home Purchase: What Else Home Buyers Buy, (with information taken from The Charleston Gazette) explains that a home purchase is just the tip of the iceberg of what today’s homebuyer knowingly gets him or herself into. It then becomes a year-long spending spree that includes furnishings, decorating, personalization and enhancement.

The National Association of Home Builders (NAHB) cites first year buyers of new or relatively new homes dump an average of $8,600 into appliances, furniture, and property alterations; about 2.5 times the $3,132 that an average non-moving home owner spends in a year. The average buyer of an older home – one built ten or twenty years ago – is not far behind, with an average expenditure of more than $6,500 that first year.

“Hole-in-your-pocket” syndrome is alive and well among these segments almost immediately after escrow closes. Nearly half of a homebuyer’s earmarked funds (or what is otherwise relegated to shiny stamped plastic) is used up during the first six months. An end or slowing to the financial drain usually takes place by the fourth quarter of home ownership.

Chicago Tribune’s Leslie Mann, reports that the state with households that spend the most on furnishings is Connecticut (Marin County, CA takes the lead for counties) and the lowest is West Virginia, according to ESRI Business Solutions, a firm that tracks such data.

So where does this money go?

Furnishings take the lead; sofas, chairs, tables, linens, rugs and blinds. Buyers of newer homes spend more than four times as much as their non-moving brethren during their first year of ownership.

Property alterations and repairs take second place, with an average of a little more than $3,000 in spending for the typical new-home buyer’s first foray. This includes fences, driveways, walkways, kitchen and bath remodeling, repairs and roofing, according to BUILDER®. Buyers of “homes with experience” tend to throw money at plumbing fixtures and HVAC (heating and air conditioning) overhauls.

Next come appliances, which gobbles up an average $1,900 piece of the first-year pie. A real surprise here is that computer hardware (not generally thought of as an appliance) figures largely in this component ($249). After that come lawn maintenance equipment, refrigerators, sound systems and televisions.

One lesson to be learned here is how important homebuilding and home purchasing is in the big scheme of things with our ever-scrutinized economy. The construction of 1,000 single-family homes generates just under $80 million in wages and $42.5 million in tax revenues and fees. The NAHB study shows that homebuyer spending reverberates for years following a home purchase to benefit local economies. From landscaping and contracting businesses to appliance and furnishing retailers, flatware and kitchen doodads – you can trace it right down to the sale of light bulbs and liken it to a gigantic ripple effect of one stone being dropped in the middle of a lake.

So, next time you hear the local new reports or read the financial newspapers figures on the level of housing starts over the past quarter, you may begin to understand just how integral a segment this is of the American patchwork quilt – and perhaps appreciate those sticks going up in so many of the suburbs and revitalized urban areas that we proudly call home.

Published: April 22, 2003

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A veteran of the real estate and homebuilding industries since 1986, Dena Kouremetis first joined Realty Times as a new homes writer in 1998. Since then, she has authored four books, written consumer columns on new homes issues for websites and newspapers all across the country, contributed to builder trade magazines, appeared as a guest expert on several radio shows and even created a ten-chapter podcast for LendingTree.com’s homebuilder website, iNest.com, now available on iTunes, entitled Uncharted Waters; Navigating the Purchase of a New Production Home. Kouremetis recently joined her local Folsom, CA Coldwell Banker office as a broker associate while continuing to write for the real estate industry. For the past three years, she has been training real estate agents for both the resale and new homes industries, putting her experience, research expertise and gift of expression to work to help others entering the business.