Consumers are going through the biggest shift in decades in how they decide which products and services are worth buying, he said, and they are looking for what leads to happiness.
"One predictor of happiness is relationships with others," Smith said. Consumers are creating a "culture of contentment," he added, which is "more and more rooted to their intimate relationships with others."
Referencing the latest consumer survey research and comparing it with earlier findings, Smith suggested there are several things that home builders should keep in mind as they approach their buyers:
■"Debt is just bad," in the minds of consumers, and it "influences their judgments," he said. "There is a visceral fear or distaste for being obligated in that way, and this does have an important bearing in how they think about housing."
In sharp contrast to the boom years, when the economy was going strong and there didn't appear to be much risk in taking on more debt, "risk is back on the table," he said. Consumers believe that "you can't get to a better life by taking on financial risks and they are more attentive to the consequences."
With good reason, about three-quarters of today's consumers say they are aware of the need to identify and manage risk; 61% say they have cut back on spending because of concerns about the future and 60% are concerned about the state of the economy in general.
The challenge for builders is to take the risk out of buying. Smith cited several examples where corporations and retailers have done just that: Hyundai's assurance plan, in which buyers who lose their job can return their car without adverse consequences; Jos. A. Banks' risk-free suit, which provided refunds for job losers; BioVigil's clean hand monitor for restaurant workers; a MasterCard program that enables borrowers to impose credit limits in various spending categories; and builders who have offered recession-proof houses that made payments after owners lost their jobs.