In short – there’s lots of new construction in Charlottesville and Albemarle.
It’s been said that 2013 is the year of the return of the spec house; we’re seeing more new construction than we’ve seen in years. Buyers have more options, sellers have more competition.
Four important and relevant stories before we get started:
– Why take a Buyer’s Agent to new construction?
– Buying new construction without a Realtor? Read this first! (note: this builder is now no longer doing business in Charlottesville, but we have two national (and maybe a third on its way) builders now and many builders use their own contracts – caveat emptor – or: hire competent buyer representation!)
– Charlottesville – A Healthy Housing Market (for New Construction) – With some Context
– The most important home inspection in the new construction process
The evolution of the new construction market in Charlottesville* has been one where there were once dozens of homebuilders and now there are a handful. And that handful are building. A lot.
The ramifications of all of this construction are many. A few to start:
– Increased competition for existing homes
– Denuding of the landscape
– More choice for homebuyers
– The opportunity for homebuilders to differentiate themselves is more challenging than ever … if everyone offers granite and everyone offers hardiplank and everyone offers an open floor plan …
– Those seeking to purchase homes now with resale in mind (that should be all of you) need to keep at least two things in mind:
1) The siting of the house matters (location, location, location)
2) You’re likely to be competing against new construction for quite some time.
– Some of the neighborhoods on the map have 5-10 homes to be built (Evangeline for example), some have 10-50 (Dunlora Forest) and some have 100+ (Old Trail)
View New construction in Charlottesville in a larger map
Real estate is local – and I’m thinking that our area may be leading the charge in a return to new construction.
Mike Simonsen from Altos Research writes (read the whole post – he describes a lot of important topics and segments of the real estate recovery):
Since 2007, new housing starts have been anemic. The long-term average construction rates are about 1.5MM homes per year. In the last six years, we’ve averaged well under 1MM. And since 2009, the average is closer to 500,000. Meanwhile population and household formation keeps on trucking. The over-construction that happened in the bubble is a distant memory. See the chart to the right. Construction volume under the orange line are “undersupplied†conditions. The homebuilders imploded so profoundly after the bubble, that we haven’t had this few new homes being built since 1959.