Posts Tagged ‘new home’

If I’ve said it once, I have said it 1000 times. Follow the new home market for insight on the overall market. Understanding what is being spent on a new homes is valuable information. There is a relationship between the value of new homes and resale homes.

That being said, there is some very interesting information coming out of the new home market right now. When it comes to new home values, there are many angles to consider.  Overall residential supply, availability of land, short sales and foreclosures, and cost of construction all have impact on values.  For some time now, lack of confidence and declining housing starts have kept construction costs down.  That may have just changed.

From Drew Holzwarth of Piedmont Realty and Construction: 

“This has been an interesting week for a variety of reasons.  The positive industry news in the media, with several industry analysts calling the bottom of the housing market, has led to a building production manufacturer reaction that I expected.  Anemic margins have been achieved by suppliers, contractors and builders alike the past few years in the real estate market.  The fourth quarter of 2011 has been highlighted with attractive corporate profits in other industries that  have lifted the equities  markets and increased consumer confidence.  This positive global news has led to Analysts who follow our industry to say that we have hit the bottom and there should be a slow climb from this point.   I fully expected our national building material suppliers to pounce on this news and they have.  On Wednesday, all 3 national drywall suppliers – the only ones left that produce drywall in the United States announced price increases – all the same – all 35% increases, Effective immediately.   In my career of following pricing of building products, I have never seen this level of a price increase.  The bumps are historically 5%  to a maximum of 10%.  Their only competition is Chinese Drywall…..pass.    On Friday, Timberline and Tamko announced a 15% increase on roofing products.  This week, I expect, similar increases from Fiberglass insulation, PVC plumbing pipe, lumber, and cement – raising concrete prices.  Crazy and frustrating.  The market remains challenging and homebuilders will have to continues to stay relevant and sell value in order to justify building new vs. the value in buying resale homes.”

Holzwarth’s company is the largest privately held home builder in our area. Piedmont Realty and Construction closed 72 sales for just over $29 million in sales volume in 2011.

This is a very interesting development for certain and some builders will react faster than others. I read somewhere that builders will need to absorb these additional costs themselves. I don’t see that happening. From the builder’s I talk to, there really isn’t room. Over the last few months, new homes sales have been steady in our area with renewed, yet cautious, optimism going forward. Hopefully, the market can absorb these price increases and keep moving. We will see.

New home sales have represented roughly 20% of all sales in Albemarle County for the last 2 years. In many segments of the market, buyers are evaluating their choices and finding that  a new home, exactly the way they want with energy efficiency features, is a better value than their resale options. Today’s buyer is far more deliberate and long term minded than the buyer from just a few years ago.

It will be very interesting to monitor new home prices and their impact on sales in both the new home and resale markets. But as you can see from above, the builders and developers are working hard to be relevant in the market and respond to demand.  If you are considering a purchase in the coming months, be sure and get out there to see what is available new, even if for no other reason that the context it provides.

If you’d like to have a conversation about this market and your goals for buying or selling in 2012, feel free to contact me.

The 2011 BRHBA Parade of Homes is just around the corner. This is a great time to get out and see what’s going on in the new home market in the area and to learn more about the latest trends and construction practices.  Energy efficiency continues to be a driving factor with potentional new home buyers. I’ve always believed that understanding the new home market really helps gain insight into the overall market. There’s no better way to understand what’s happening than to go out and see for yourself.

Piedmont Realty and Construction has now completed their first entry for this year’s parade. This home is located in Spring Creek. If you can’t wait, it’s open now Tuesday-Sunday 11-5. Otherwise, the parade is October 1st and 2nd/8th and 9th this year. I’ll post more information here as it is available.

Here’s a blog where Piedmont shared construction progress, floor plans, and final photography of this new one level plan. Feel free to contact me for a private showing or a conversation about the Charlottesville area real estate market.

The Fairview.

Model Home Now Open Tues-Sun 11-5

Please note. The term “Earth Friendly” is trademarked by Piedmont Realty and Construction as their branding for the way they achieve energy efficiency in the homes they build.

It was 2007 when a few of our local area home builders started utilizing new building sciences to achieve energy efficiency. Lots of different materials and methods were being tried and there was definitely a learning curve.

Regardless of the methods at the time, I was impressed immediately. I can remember spending winter mornings in my home built in 2003 and afternoons in one of these brand new energy efficient homes. The difference was maddening. I wanted to tear down my 4 year old home.  My home felt drafty and uncomfortable by comparison. This was before there was any real data regarding energy cost savings.

Fast forward to 2010, and I finally got my new energy efficient home. Living  in this home since September, I have now experienced Fall to Winter to Spring.  I am constantly looking for ways to share what it is really like to live in a home built this way.

The analogy that comes to mind is from the auto industry. I am interested in energy efficient cars too. We own a VW TDI (Clean Diesel). The best way to describe this 40MPG avg vehicle is that it sips gasoline. Hybrid is the other new car technology and by far more well known. I test drove a Prius for 24 hours last month. This car achieves 50MPG by switching between battery power and gas. What I didn’t realize was how it operated in start and stop and slower speeds. Sitting at a stop sign, the car simply does not run. It is the savings from not using any gas at all that brings the MPG way up.

Now back to the “Earth Friendly” home.  I was reminded of the Prius over the last couple of months. When discussing the Earth Friendly home, we always start with the way the home is insulated. The structure is foamed in to “seal the envelope.” I’ve heard it described  as building an igloo cooler. When the home is heated, it holds the warmth longer. When the home is cooled, it has the same effect. In the Spring and Fall in the area, we have warm days and cool nights. Not unlike a Prius at a stop sign, this is when the savings start to add up. We turned our heat off after the first few above 70 degree days. With warm days and cool nights, I noticed our HVAC was not running at all. Over night, the home held its heat acquired during the day.  Essentially, for the past two months this home as pretty much held a range from 68-72 with virtually no support from the HVAC. This is where the savings really start to add up.

I am collecting data on two homes for comparison. More below. I don’t have enough to share the results in their entirety. However, I was so impressed by the early data, I felt compelled to start telling this story.

EARTH FRIENDLY HOME A: Built 2010, 3400 finished sq ft, Two zone Trane HVAC, (Zone 1 gas furnace), tankless gas water heater. This home also has a finished space over the detached garage with its own electric HVAC system not run full time.

NON-EARTH FRIENDLY HOME B: Built 2000, 2995 finished sq ft, one zone electric HVAC system, traditional electric water heater.

Since there is gas involved in one of these homes and not the other, we will look at the winter months when more data is available on the cost of the gas consumption.

HOME A electric bill March $115, April $98 for a total of $213.

HOME  B electric bill March $200, April $180 for a total of $380.

More to follow.  Feel free to contact me to discuss any of this in greater detail.

Just a little past their two year anniversary, Piedmont Realty and Construction is expanding their offering.  This is consistent with why I think they have been successful.  Drew Holzwarth continues to innovate and stay relevant.  More on the new offering in a moment.

Tracking new home sales in the area, I see Piedmont continuing to grow their market share.  One reason is innovation. Piedmont is constantly trying to improve their offering. The latest innovation? Every Earth Friendly Piedmont home now comes standard with a Trane hybridHVAC system. This is remarkable and going to save their owners thousands of dollars over the life of the home.  Other 2011 improvements include quiet close cabinet doors, new double hung low-E windows, and tank-less water heaters.

Another reason for their continued success is finding segments of the market under served and customizing an offering that adds value to that segment of the market. I refer to this as staying relevant. Even after two years, I find myself impressed by the depth of experience that allows them to stay relevant.

This brings me to the topic of this post. Piedmont Realty and Construction is developing and introducing what will be known as their Estate Series of homes. Starting with the Keswick (tour below), Piedmont is now serving the $800k-$1.5M range by offering custom homes in Albemarle County communities like Glenmore, Ragged Mountain Farm, South Ivy Estates, and Old Trail. With two homes over $1M currently under construction in Old Trail, Piedmont is proving their capabilities once again in this new price range.

Check out The Keswick.

I recently wrote a post on Belvedere and why I thought it’s time had arrived. There is another master planned community in the Charlottesville area getting a lot of attention as well. Old Trail Village is a much larger venue, but experiencing success for a lot of the same reasons as Belvedere. There was a recent article written by Charlottesville Tomorrow, picked up by The Daily Progress, on Old Trail’s 2010 success. Read it here.

Old Trail is a little further along in terms of infrastructure and amenity completion, but very young in the grand scheme of what this development will become. The article above has caused a lot of conversations about Old Trail in the past week, so I thought I would break down the sales a little more.

The breakdown below will be of the 61 sales as reported to the CAAR MLS in 2010. Beights Development is reporting 70 sales and closings and I have no reason to doubt that number. The 61 sales represents sales reported to the MLS by contract date. When following new construction stats on an annual basis, you have to choose to look at closed sales or contract dates since there is usually a 4-6 month lag for construction. I choose to look by contract date since that is more of a leading indicator. Custom sales that are not reported to the MLS continue to occur. These sales are usually on the higher end. That is, $500k+. I can identify 4 under construction now just driving through the community.  Old Trail is a place where lower volume, custom home builders are still finding success, since a homeowner can buy a lot and then choose a builder.

The resale market. 13 of the 61 sales were not new construction. Of these sales 2 were short sales and 4 were foreclosures. That’s a relatively large percentage of the non-new construction sales as distressed. I think there are two reasons. Old Trail had a lot of sales at the top of the market and there aren’t many homes for sale here in general.  For example, as of today, there are just 5 resale listings under $1 million dollars.

The new home market. 48 sales. 13 attached and 35 detached. 

Craig Builders is responsible for the townhome sales. 3 story townhomes with 2 car garages starting at $239,900.

Of the 35 detached sales, 5 were under $300k, 11 were in the $300′s, 10 in the $400′s, and the remainder over $500k. The builders included Piedmont Realty and Construction, Craig Builders, Stonehaus Residential, Peak Builders, Eagle Construction, and Southern Development Homes.

This is what I think is key for Old Trail. A wide variety of offerings across a broad price range. Not many communities have pulled this off. If you are interested in the Charlottesville area new home market or Old Trail specifically, I’m here to help you understand your options.  I’ve recently become an Old Trail resident and happy to discuss my personal experience.

I have been involved with Belvedere since working from a tent on Rio Road prior to the roads being paved or any homes being started.  I’ve been a huge fan of the overall concept from the beginning.  New urbanist concepts and a commitment to green building practices are very interesting to me and relevant to the market. I was impressed immediately in 2008 by the number of people I met who thought the concept was great, but weren’t in a position to move.  I knew all along and have shared many times that I think Belvedere’s success is only matter of time.  Here’s why:

1. Location. Its in the urban ring. Right now, there are really no new home communities as centrally located to all things  Albemarle and Charlottesville as Belvedere.  The people I am meeting interested in Belvedere now are making a lifestyle decision to give up the larger, rural lot in favor of a location that saves them time and fits their current lifestyle and the quicker pace we all seem to be living these days.
2. Smaller lots and higher density. Its true, many visit Belvedere and are immediately discouraged by the size of the lots. Its definitely not for everyone. However, many are looking for less maintenance in their lives and maybe, more importantly, community. I’ve learned that the deisgn of a community has a direct impact on the relationships that are  formed among the residents. People are choosing Belvedere because they want to know their neighbors and want to interact with them. I’ve never seen a community of new homeowners come together faster than what I have seen at Belvedere.
3. Energy Efficiency. The green building trends we hear so much about are more than just trends. Its a shift in building science that is here to stay. Better practices in home building are leading to better indoor air quality, lower utility expenses, and more comfortable homes.  Every home at Belvedere is Earthcraft certified.  Stonehaus Development should be commended for this. 
4. Home Design. Another side effect of the economic downtown is a shift in consumer demand. Huge houses are out, and smaller, better designed homes are in. Add in zoning that allows homeowners to earn income with legal residences or businesses over their garage, and you have a recipe for success.
5. Walking Trails. People still want to get outside and exercise. This is an exceptional component, not to mention the future with SOCA and more recreational space.

Watching what has occurred in 2010 at Belvedere, I’m starting to get the feeling the time for Belvedere has arrived. With 31 homes put under contract in 2010, the answer may be obvious. The last 60 days of 2010 saw 12 contracts and the activity hasn’t slowed since. There are now just 33 available detached home sites in Phase 1 remaining.  The new apartment complex (The Reserve at Belvedere) is set to break ground next month. The conversation regarding the town center makes it seem like its time may really be here as well, with unofficial estimates for a late 2011 ground breaking.

There are now 5 builders actively marketing and selling homes in Belvedere:

1. Piedmont Realty and Construction
2. Stonehaus Residential
3. Gibson Homes
4. Southern Development Homes
5. Eagle Construction of Virginia

Home prices start in the $200′s and there is a variety of home styles and types available. There are currently 7 detached “spec” homes for sale. Later this spring, Piedmont will be offering 11 newly developed townhome sites on the Village Green. If you are in the market for a towhome in 2011 and appreciate the concept of Belvedere, these may be the best opportunity of the year.

If you are interested in Belvedere and the prospect of building a new home, I would welcome the opportunity to share my experience and insight to your process to determine if Belvedere is right for you, and if so, how to choose the right builder fit for your budget, timeline, and needs.

If you are interested, one of the original residents is a blogger. Check out her blog here.

There’s a new community just under way in Albemarle County just outside of the city limits of Charlottesville. Its called Avinity and it will feature 100 townhomes located on Avon Street adjacent to Cale Elementary. Site work has started. I visited the site this morning to get a feel for the progress of the site work and the surroundings. Check it out.

Check out the site plan here.

I’ll be in charge of sales for Piedmont Realty and Construction. Currently I am working out of  The Piedmont Model Home at Poplar Square. (Located just off Ivy Road behind the Kluge Children’s Rehabilition Center) These townhomes are very similar to what will be built at Avinity. Feel free to contact me or stop by to learn more about Avinity at your convenience, Tuesday-Sunday from 12-5.

Subscribe to my blog above for future updates on the progress of Avinity.

It’s been a while since I’ve posted. I had a great trip with the family to Disney World and guess what? I’ve been extremely busy. November and December are usually a little quiet for me and offer the opportunity to focus on planning for the year ahead. I also like to try and take advantage of more family time as well. Not this year. Something is going on in the market and I have not been able to get my brain around it. I just took a minute to try and quantify what I was “feeling” about the market by pulling some stats.

First, here are some anecdotal events that shape my feelings:

1. Piedmont Realty and Construction had 10 new home sales in November and 8 so far in December.

2. I had a client lose out on a home they wanted last month in a multiple offer situation.

3. I helped a client get under contract today on a home that had been on the market 182 days. There were 3 offers on the table.

4. I am talking to many in the business who are “feeling” this spike in activity.

I pulled some quick year over year contract stats to see what story they told.  Just looking at Albemarle and Charlottesville, October was significantly down. But confirming my “feelings”, this is what I found for November and MTD December:

Albemarle County  NOV 2009 64 vs.  NOV 2010 91   MTD DEC 2009 24 vs. MTD DEC 2010 47

Charlottesville  NOV 2009 20 vs NOV 2010 25  MTD DEC 2009 9 vs MTD DEC 2010 13

I realize the numbers for Charlottesville aren’t startling, but its been a while since there has been a year over year increase in sales in the city. I think the uptick in Albemarle is definitely noteworthy. Its hard to pinpoint why this may be occurring, but I think whenever the market is supressed for long periods of time it creates pend up demand.  There’s no doubt it’s there.  Maybe its a fluke. Maybe its those watching interest rates realizing they can’t stay down forever and really aren’t heading below 4 percent. I had one person speculate today it was confidence over talk about tax break extensions. I’ve always thought if the circumstances were right, the winter was a great time to buy. There are often less buyers in the market and usually more motivated sellers on the market, as many pull their homes off for the holidays.  “Thinning” the herd of the less motivated participants in the market may have cleared the way for the most motivated to do business.

The end of the year is near and soon it will be time to take a look at 2010 vs 2009. I look forward to digging a little deeper. I also intend to update the stats I have been keeping on the distressed sales in our market place to identify potential trends as well.

If you’d like to have a conversation about your real estate plans in 2010, feel free to contact me. I enjoy the conversation.

Energy efficiency continues to be a topic that more and more home buyers are discussing.  The way new homes are being built and insulated in order to achieve energy efficiency is an important topic.  In my opinion, when considering a purchase,  energy efficiency may be the #1 reason to consider building a new home. This is a major trend in housing that is generating momentum on a variety of levels.  We talk about “sealing the envelope” and a better insulated home with higher R-values.  Those are relatively simple concepts. Just as important is the HVAC component of this converstation. Its the engine of the car, if you will allow the analogy.

What I’m sharing comes from working with Piedmont Realty and Construction, because that’s where a lot of my knowledge on this topic originates. I have had a lot of conversations with Drew Holzwarth and his contractors on this topic.  The #1 point I would make for prospective purchasers is that you want to make sure you get a home that has the right size system for the space. If you don’t, the rest won’t matter.  Piedmont accomplishes this by having their HVAC contractor perform a “j-calc” for every home they build.  Its very common for builders to take the “one size fits all” approach to HVAC.  That is, each time they build “Model A” they have the HVAC contractor install the same system, regardless of modifications to the plan.  Whenever you change a plan size or shape or even move/add/delete windows you have impacted heating and cooling considersations. Windows impact natural heat transfer. All this needs to be considered in the sizing of the system.  I’m not sure why more builders don’t do this other than its extra work and costs money.

There’s a lot to learn on this topic. I found this handy resource on system sizing, SEER, airflow, ductwork and how it all relates to efficiency. Check it out here.

If you are considering a new purchase, ask the right questions. Make sure you are working with a builder that has a philosophy and team that is committed to building a better home.  Piedmont Realty and Construction does and that’s why I live in one of their homes.

As a Realtor who has spent much time trying to understand our local new construction market, I have spent a lot of time watching the builders in our area. I have also represented several over the years. One of the key things I have learned along the way almost never comes up.  Two builders can take the same materials and build the exact same home and the end result can be very different. The difference. Supervision. I would argue the project manager in charge of the construction of the home may be the most important component of all.

Once its time to start construction, lots can go wrong and surprises are everywhere.  A good project manager knows how to schedule, supervise, communicate, and hold sub-contractors accountable to their standards. Let’s look at each component.

Scheduling. If this is not done efficiently, all sorts of things can go wrong. The sub-contractors might not work together well, things have to be done and re-done because the home was not ready for a particular trade, and utlimately the delivery date could fall by the wayside.

Supervision. The project manager has to be present and in charge to prevent problems and catch mistakes. I see way too many homes get built by subs who are basically unsupervised.

Communication. Some of the worst experiences I have witnessed home buyers have over the years could have been solved by a project manager that was responsive and communicated. Without this the frustration mounts, trust is broken, and the entire experience can turn sour. Its just not necessary.

Accountability. Last but not least, if the project manager does not effectively communicate the standard of finish and make the subs get it right or do it over, the home will not stand the test of time. The subs are there for one component. If all of the components are not done well and don’t complement each other, it will show in the long run.

Here’s my advice.

1. Ask questions about the builder’s organization and their process. Find out who will be your point of contact throughout the process.

2. Ask questions about construction practices. Make sure you get to see detailed construction specifications. Asked about fasteners, sheetrock finish, plumbing materials, and HVAC equipment.

3. Ask about policies for visiting the home, selection appointments, planning appointments, inspections, and walk through.

4. Ask about change orders and how flexibile their process is to help you get exactly what you want.

There’s much more to this but hopefully you get my point. I see too many people get caught up in comparing builders based on cosmetic finishes like flooring and counter tops. All of the best finishes available won’t much matter if the home is not put together well.

We have several quality home builders in our market. I’ve gotten to know the Piedmont Team well and find their project managers to be exceptional. Check out their resumes here. A good project manager can make all of the difference in the world.