You’ve likely heard the reports of new home construction slowing in parts of metro Atlanta and around the nation as a result of the economic downturn and its blow to the housing market.
In Intown though, steady and improving are the buzzwords these days as 2012 gets underway. We talked with three builders to help us shed light on the current trends: Monte Hewett of Monte Hewett Homes (montehewetthomes.com); Ryan Locke of Principle Builders Group, LLC (principlebuildersgroup.com); and Christopher Rudd of Thrive Homes (thrivehomesatlanta.com)
In what Intown neighborhoods are you building?
Monte Hewett: Inside the perimeter we are building in Virginia Highland, Hillside at Chastain, Chastain Park, Westminster, West Buckhead, Park Overlook, Decatur/Oakhurst Highpoint Manor and South Sandy Springs.
Ryan Locke: We work in Buckhead, Virginia Highlands, Ansley Park, Midtown, Brookhaven, Old Fourth Ward – basically anywhere the client will take us. We see strong growth in some of the lower cost areas like Kirkwood and Edgewood.
Christopher Rudd: Our Intown construction is limited to where we can identify lots, predominantly east of Peachtree Street and north of I-20. The primary focus is on Intown neighborhoods such as Decatur, Oakhurst, Kirkwood, Lake Claire, Candler Park, Virginia-Highland and Grant Park.
What price points are selling?
Hewett: $350,000 to $1 million-plus; it is really location and product specific.
Locke: The warm markets are between $150,000 and $380,000.
Rudd: Price is extremely neighborhood dependent. We are selling homes across multiple price points, in the $300,000 to $500,000 range in Kirkwood, the $500,000 to $800,000 range in Decatur and the $700,000 to $1,200,000 range in Inman Park, Candler Park and Morningside.
What does the typical buyer now look like?
Hewett: They are prioritizing locations based on walking communities and lifestyle convenience. They don’t want to spend time commuting. They want all the closed-in conveniences. They are nervous like others, but because the supply is more limited, they are willing to move forward if the home is right because they know it might not be available next week.
Locke: He or she is one with a steady verifiable income with at least 20 percent skin in the game. There are only a few banks dealing in the CP [Construction to Permanent Financing] market, but the biggest hurdle now is getting a new project to appraise for the proper value.
Rudd: Current buyers and homeowners are incredibly savvy, in tune to the market and specific about their desires. We are seeing a trend toward buyers taking advantage of low interest rates and purchasing homes that they intend to live in for the next 20 to 30 years.
What special features/design elements are buyers looking for?
Hewett: They are looking for great kitchens with all the latest features, hardwoods. It seems to be less about square footage and more about function in the design of the home.
Locke: Cost, cost, cost! We find only a few of our clients are willing to create a home that reflects their specific architecture and design styles; it is all predicated by value.
Rudd: Buyers are looking for quality-built homes with low maintenance – that are equally well-suited for both day-to-day living and entertaining. Buyers appreciate the energy savings that result from the implementation of green building practices.
What do you forecast for new home construction in 2012?
Hewett: In general, things are improving overall. It will still be a slow market for quite a while. We are going to continue to seek out great locations and build amazing homes that our buyers are looking for.
Locke: We are forecasting a steady pipeline of custom homes for 2012 but no growth – a zero percent year-over-year growth. We have to remember that zero growth is better than negative growth. Our renovation forecast is much stronger with a 22 percent year-over-year growth in revenue.
Rudd: We anticipate that new home construction will remain strong in neighborhoods supported by stable commercial districts, excellent schools and strong neighborhood organizations.