BEND, Ore. (CNN/Money) – Americans, it seems, have been neglecting one of the best "rooms" in their house – the one out their back doors.

As such, homeowners have been trading in their plastic patio sets and bug zappers for cushy furniture and copper fire pits. They're replacing gas grills with "grill islands," and buying outdoor rugs, lamps and recliners. They're even hiring decorators to make sure their backyard color schemes blend with the rest of their décor.

"People are creating these 'great rooms' outside by putting in plush furniture," said Jan Healy, senior brand manager for Rust-Oleum, which has a new line of rust-proof decorative paints to add character to dull patio sets or spruce up chipped grills.

In May, the company launched a $10,000 backyard makeover contest to the homeowner who sends in the most creative 100-word essay and pathetic backyard photo before July 31. (see more at www.great-american-backyard.com.)

"We expect to get some interesting photos," said Healy.

Considering how many high-end products have come out for the backyard, that $10,000 could be spent pretty quickly.

According to Ralph Gillis, an architect with Gillis Previti Architects in New York, an outdoor retreat should have some shelter – whether it's a porch, arbor, umbrella or just landscaping. That not only creates a cozy atmosphere, it has the practical purpose of adding shade and blocking rain.

Fire is another key element. If money is no object, he suggests putting in an outdoor fireplace. Outdoor fire pits -- which start around $100 -- are a popular alternative.

"People are focusing on fire and water," said Paul Ambrose, president of Yardiac.com. "They're adding fire pits, hearths and fountains."

Although many homeowners are happy cooking on a simple charcoal grill, the ideal retreat has some space for preparing food and keeping drinks cold. Hence the popularity of grill islands -- outdoor kitchens complete with mini stainless steel refrigerators and sinks.

According to Corey Tisdale with The Grill Store and More, outdoor kitchens are the most popular product this year, even more popular than grills.

Designer Jay Jeffers turned this San Francisco rooftop deck into a comfy retreat.

Comfortable furniture is also essential, said Jay Jeffers of the Jeffers Design Group in Los Angeles and San Francisco. Although many of his clients opt for custom-made patio furniture, retailers ranging from Target to Frontgate have started selling outdoor furniture that resembles living room furniture. Frontgate even sells an outdoor recliner. (See gallery.)

Lighting is a final consideration. "Often outdoor lighting is a little overdone," said Gillis. "The lighting needs to be soft."

Candles, he said, are an inexpensive way to light the back deck. "When they burn out," he said, "You tell everyone to go home."