Value of Architecture: A Financial No-brainer
The numbers don’t lie. Architecture is more than just designing and building structures. It brings value to clients in various ways that go beyond aesthetics. From capital gains to operational savings and improved physical and mental health outcomes, hiring an architect can be a wise investment.
Little Known Statistics
One significant benefit of hiring an architect is the potential for capital gains. According to a study by Melbourne University, after 10 years, the median Melbourne house price of $1,200,000, the homeowner who hired an architect was $256,000 better off than the homeowner who didn't. The reason for this is that architects design for the future, taking into account the changing needs of the owner and the market. A well-designed home can increase its value over time and lead to greater returns for the homeowner.
Operational savings are another advantage of hiring an architect. Certified passive house designs can save up to 90% of heating and cooling energy, according to the Passive House Institute. This means that the homeowner will spend less on energy bills, which translates into long-term savings.
On average, retrofitting a home for accessibility costs 22% more than designing for it upfront, according to the Harvard Joint Center for Housing Studies. Read the article below for more reasons why designing for accessibility upfront is something we should all be considering the impact of.
Homeowners & Owner-occupiers
Architecture can also have a positive impact on the physical and mental health of the owner-occupier. A well-designed home can enhance the quality of life, improving both physical and mental well-being. For instance, natural light and ventilation can promote healthy living and productivity, and well-designed outdoor spaces can provide relaxation and stress relief.
Better Functionality: Architects can design homes that are tailored to the homeowner's specific needs and preferences. They can take into account factors such as family size, lifestyle, and daily routines to create a home that is both functional and comfortable. A well-designed home can enhance the quality of life and improve daily living. (Source: Royal Institute of British Architects - RIBA)
Increased Property Value: A well-designed home can increase the overall value of the property. According to a study by the Australian Housing and Urban Research Institute, "Design quality is a key determinant of the value of residential property in Australia." Additionally, a well-designed home can have a higher resale value, potentially resulting in a better return on investment. (Source: Australian Housing and Urban Research Institute - AHURI)
Energy Efficiency: Architects can design homes that are energy-efficient, leading to lower operating costs and potentially higher resale value. Strategies such as passive solar heating and cooling, efficient HVAC systems, and proper insulation can reduce energy consumption and improve indoor comfort. According to a study by the UK Green Building Council, "Building to energy-efficient standards can add value to homes and improve marketability." (Source: UK Green Building Council)
Improved Health and Well-being: A well-designed home can improve the health and well-being of the occupants. Natural light and ventilation can promote healthy living and productivity, and well-designed outdoor spaces can provide relaxation and stress relief. Additionally, designing for accessibility can improve the quality of life for occupants with disabilities or mobility issues. (Source: World Health Organization - WHO)
Sources:
Royal Institute of British Architects. (2020). Why use an architect? https://www.architecture.com/find-an-architect/why-use-an-architect
Australian Housing and Urban Research Institute. (2016). The Value of Good Design. https://www.ahuri.edu.au/__data/assets/pdf_file/0017/2679/AHURI-Final-Report-274-The-value-of-good-design.pdf
UK Green Building Council. (2019). Building for Health. https://www.ukgbc.org/wp-content/uploads/2019/02/Building-for-health.pdf
World Health Organization. (2010). WHO Housing and Health Guidelines. https://www.who.int/publications/i/item/9789241547723
Property Investors
But the benefits of architecture are not limited to owner-occupiers. Landlords can also see increased returns by hiring an architect to design their properties. A well-designed building can attract higher-quality tenants and increase rental income. Additionally, tenants can enjoy improved lifestyle outcomes, such as better access to natural light and ventilation, improved thermal comfort, and better accessibility features.
When landlords hire an architect to design their investment properties, they can expect various financial benefits. Here are some examples:
Increased Rental Income: A well-designed building can attract higher quality tenants who are willing to pay more rent. According to a report by the Australian Property Institute, "High-quality architecture and design can create a point of difference that will attract tenants and potentially increase rent." Additionally, a well-designed building can have a higher resale value, potentially resulting in a better return on investment. (Source: Australian Property Institute)
Reduced Operating Costs: Well-designed buildings can be more energy-efficient, leading to lower operating costs. This can be achieved through various design strategies such as passive solar heating and cooling, efficient HVAC systems, and proper insulation. According to the US Department of Energy, "Investing in energy-efficient design can reduce energy costs by up to 30 percent."
Increased Property Value: A well-designed building can increase the overall value of the property. This can lead to higher resale value and potentially a better return on investment. According to the National Association of Realtors, "Properties with good curb appeal and desirable features can increase the overall value of a property by up to 10%."
Reduced Maintenance Costs: Buildings that are well-designed can require less maintenance over time, which can save landlords money in the long run. For example, a building with a well-designed roof can require less frequent repairs and replacements. (Source: Royal Institute of British Architects - RIBA)
Reduced Vacancy Rates: A well-designed building can attract higher quality tenants and reduce vacancy rates, which can save landlords money on lost rental income. According to a study by the UK Green Building Council, "Well-designed buildings that provide an excellent user experience can help to reduce vacancy rates." (Source: UK Green Building Council)
Sources:
Australian Property Institute. (2018). Architecture and Property Value. https://www.api.org.au/__data/assets/pdf_file/0019/204097/Architecture-and-Property-Value.pdf
US Department of Energy. (2021). Building Energy Efficiency. https://www.energy.gov/eere/buildings/building-energy-efficiency
National Association of Realtors. (2017). Remodeling Impact Report: Outdoor Features. https://www.nar.realtor/sites/default/files/documents/2017-outdoor-features-remodeling-impact.pdf
Royal Institute of British Architects. (2020). Why use an architect? https://www.architecture.com/find-an-architect/why-use-an-architect
UK Green Building Council. (2019). Building for Health. https://www.ukgbc.org/wp-content/uploads/2019/02/Building-for-health.pdf
Businesses and Brands
Businesses looking to enhance their brand, culture, employee health, retention, and financial returns should consider investing in architecture. The impact of well-designed buildings and workspaces on business success is backed up by compelling statistics from around the world.
Brand: A business's brand identity can be significantly enhanced by the design of its building. For example, the Burj Khalifa in Dubai, UAE, designed by Skidmore, Owings & Merrill, has helped establish Dubai as a global business hub, contributing to a 79% increase in Dubai's economy over the past decade.
Culture: A well-designed workspace can also foster a positive work culture that encourages collaboration, creativity, and innovation. A study by the American Society of Interior Designers found that 90% of employees believe that a well-designed workspace positively impacts their work satisfaction, while 88% of employees agree that an inspiring work environment boosts their creativity.
Employee Health: Good architecture can also promote employee health and well-being, which can reduce absenteeism and increase productivity. Research has shown that access to natural light can reduce employee sick days by up to 6.5%, while better air quality can increase productivity by up to 11%.
Employee Retention: Investing in good architecture can also help businesses attract and retain top talent. A study by Gensler found that companies with a strong workplace culture have a 54% higher employee retention rate than those with a weaker culture. Additionally, 61% of employees say that the design of their workplace is an important factor in their decision to stay with a company.
Financial Returns: Finally, architecture can have a significant impact on a business's financial returns. A study by CBRE found that high-quality office design can increase rental rates by up to 30%, while a well-designed building can command a sale price that is up to 12% higher than a poorly designed building. Additionally, buildings with sustainable design features have been found to have a 6.6% higher occupancy rate and 16% higher rental rates than those without sustainable features.
In conclusion, investing in architecture is a wise decision for businesses looking to boost their success. The statistics speak for themselves, demonstrating the power of good design to enhance brand identity, work culture, employee health and retention, and financial returns.
Sources:
https://www.gensler.com/research-insight/blog/2016-u-s-workplace-survey
https://www.cbre.us/research-and-reports/The-Impact-of-Office-Design-on-Business-Performance-2018
Architecture is a valuable investment for clients looking to improve their financial, operational, and health outcomes. From capital gains to operational savings, and physical and mental health gains, hiring an architect can bring numerous benefits. So, if you're considering a new building project, consider working with an architect to ensure that you achieve the best possible outcomes.
