Credit: Courtesy David Weekley Homes
These best-selling projects are like the results of a scientific experiment. What if you subjected the housing market to the worst possible conditions? What would people buy even if they were worried about job prospects, concerned about falling home prices, and couldn’t be sure economic conditions would improve?
What you’d get is a list of evergreen projects, ones likely to sell no matter the economic conditions. Within these test projects you would also be likely to find the seeds of the industry’s future—safer bets for bank loans.
To gather these test cases, we went to researchers who collect new-home sales data in local markets. We asked them to nominate projects from among the very best selling in the markets they track, projects that reflect trends, present and future.
The result is a collection of winning projects that speak to the wide variety of housing solutions that builders undertake. You’ll find one-of-a-kind urban loft projects, sympathetic infill projects that rose out of decades-old neighborhoods, and suburban tract neighborhoods priced to compete with distressed sales, to name a few.
Besides a high sales rate, the projects share other salient characteristics. Many are green, typically built to a local standard. They tantalize buyers with the prospect of lower operating costs and a light carbon footprint. Most, as you would suspect with any list of fast-selling projects, are targeted at entry-level buyers, typically touting the availability of FHA financing and federal tax credits.
Several projects evoke memories of happier times, when people camped out to get first dibs on a community, when builders developed long waiting lists before they released homes, when developers could point to monthly sales rates in the double-digits. Perhaps those good times will return one day. If they do, it will probably be because of projects like these.
Back at the Ranch
Credit: Eric Figge
Project: Ivy at Woodbury East; Location: Irvine, Calif.; Developer: The Irvine Co., Newport Beach, Calif.; Builder: William Lyon Homes, Newport Beach; Rate of sales: 28 homes from July through August; Price range: Starting in the mid-300s; Product type: Townhomes
When William Lyon Homes opened Ivy at Woodbury East on the Irvine Ranch in July, more than 2,000 people showed up for the celebration, and not just to kick tires. They brought checkbooks. In fact, the Newport Beach, Calif.–based builder sold out the first phase of 13 green townhomes in just 15 minutes. Another 15 homes were sold in a second August phase.
The experience brought back memories of boom times, when buyers spent the night to be first in line for new projects that quickly escalated in value. The situation is a little different this time around. Buyers jumped at the opportunity to buy a home on the vaunted Irvine Ranch for less than $350,000. The three townhome plans run from 1,180 to 1,500 square feet.
The price point is unusual for Orange County, one of the most expensive places in the country to live. For many locals, says Lesley Pennington, director of sales and marketing for William Lyon Homes, home-ownership “remains one of the most important milestones in the lives of people today, and achieving homeownership in Irvine is an even greater goal.”
Low mortgage rates and financial carrots, including FHA financing and state and federal tax concessions, contributed to the success. William Lyon did its best to design homes that would work for multiple target demographics—singles, small families, parents with boomerang children, and professionals who want to share a house.
Loft Living
Project: SoHo Square; Location: West Los Angeles; Developer/Builder: Wellesley Manor Corp., Los Angeles; Rate of sales: 74 of 94 units from June through September; Price range: Starting at $399,000; Product type: Lofts and Live/Work
According to a local blog, the devel-oper of SoHo Square wasn’t sure whether to release this West L.A. project as rentals or condos. Wellesley Manor apparently made the right decision. When SoHo Square opened in June, it opened for sale. Nearly half the homes sold within two months, and only 20 remained by the end of September.
Wellesley Manor, which has done its share of L.A. infill projects, kept the entry-level price for this mix of lofts and bigger live/work units under the critical $400,000 mark. That’s a tempting price for a home from which you can watch the sun come up over Santa Monica Boulevard.
The most affordable loft units in this four-story structure are small, as little as 1,100 square feet. But ceilings of more than 9 feet, with exposed ductwork and sprinklers, make them feel larger. So do orientations toward the ocean, mountains, or courtyards. Each floor sports a unique color palette.
The ground floor is reserved for larger live/work units. Starting at $549,000, they go up to 1,400 square feet, with ceilings of more than 16 feet. Each has one full bathroom, an open kitchen with either a breakfast bar or island, and an enclosed patio.
The green agenda starts with courtyard designs that promote ocean breezes to help cool units. A green roof lowers lobby temperatures. Rainwater gets filtered twice before entering the storm drain system. The interiors include bamboo floors, energy-rated appliances, countertops made from recycled quartz, double-glazed windows, and high-efficiency water heaters.
Old-Town Charm
Credit: Courtesy David Weekley Homes
Project: Mueller; Location: Austin, Texas; Developer: Catellus, Denver; Builder: David Weekley Homes, Houston; Rate of sales: 10 per month since July 2008; Price range: Starting at $269,000; Product type: Single-family attached and detached
When asked to name an emblematic best-selling community in Austin, Texas, market researcher Ted Wilson doesn’t miss a beat—Mueller, located on the former site of the city’s airport. “There are several builders in the community, but David Weekley Homes has led the pack,” says Wilson of Residential Strategies.
One look at this project reveals why it’s selling at 10 a month—compelling architecture for entry-level homes. Weekley offers two home series here: one attached, one detached. Both feature eclectic, historic styles that mix warm South Texas limestone with metal porch roofs and classic shake siding.
The row homes, which range from 1,562 to 1,967 square feet, start at $269,000. It takes only $30,000 more, or $299,000, to get into the smallest yard home, which span from 1,437 to 2,221 square feet. All of the homes are built to local green standards.
That’s a real value considering the short commutes to the University of Texas and downtown Austin. “Mueller is five minutes to downtown, but it offers amenities that you would typically have to drive 15 to 30 minutes out of the city to find,” says Andrea Von Quintus, a marketing coordinator with David Weekley Homes.
Despite the proximity to entertainment, residents may not to want to leave this place. It includes miles of trails to hike and bike, along with an amazing 140 acres of parks and green space. It will one day be within walking distance of a planned town center with cafes, shops, and plazas.
Repositioning Is Rewarded
Project: Stafford Lakes Village; Location: Fredericksburg, Va.; Developer/Builder: Centex Homes, Dallas; Rate of sales: Nine per month from January through September; Price range: $254,990 to $324,990; Product type: Single-family
Though Washington, D.C., may be do-ing better than other markets, it’s still unusual to find communities selling at a rate of eight homes per month, especially in the far reaches of suburban Northern Virginia. But that’s the pace for the last nine months at Centex’s Stafford Lakes Village Community in Fredericksburg, Va., a good 40 minutes south of the nation’s capital.This didn’t happen by accident; it was the result of arduous repositioning.
Initially, the 400 lots in the final section were split evenly between Centex and Beazer. When Beazer bailed, Centex decided to rework all the home designs, taking out square footage and lowering prices.
First, the Dallas-based company added two homes to its Classic series of affordable homes, bringing down the opening price point to $250,000. It renamed its Manor series of larger homes and tweaked them as well. These homes now start at $299,000 rather than $424,000, and range from 3,223 to 4,175 square feet.
“These are the ones that are selling at much higher rates,” says Guy Sheetz, a regional manager for Hanley Wood Market Intelligence.
Quick Out of the Blocks
Credit: Peter Valli
Project: TLofts; Location: Los Angeles; Developer: CityView, Los Angeles; Builder: Lee Homes, Marina del Rey, Calif.; Rate of sales: 13 homes in July; Price range: Starting at $415,000; Product type: Condos/Lofts
This start would make even gold medal sprinter Usain Bolt proud. TLofts burst out of the blocks in July with 13 sales and an interest list of more than 800 names. All that before Lee Homes staged a festive grand opening that produced even more interest in these one- and two-story lofts.
The early success of this fashionable, sustainable, West L.A. project, with prices starting at $415,000, was enough to bring out several politicians to the grand-opening block party, including former HUD Secretary (and executive chairman of developer CityView) Henry Cisneros and Lynn Jacobs, director of California’s Department of Housing and Community Development.
When prospects weren’t listening to remarks, they were sampling food and drink. Half a dozen hard-goods retailers, including Best Buy and Bed Bath & Beyond, brought their wares as well.
Many of these retailers will have stores within walking distance of TLofts, which is located on Tennessee Avenue, not far from Santa Monica. More than 2 million square feet of office space is also within walking distance of the project, which is close to bus stops and a proposed light-rail station, too.
But residents won’t have to walk unless they want to—each unit comes with two parking spaces in a covered and gated lot. Residents with electric cars can park them at one of 18 car-charging stations. Other creature comforts abound, including a private elevator with secure access and a landscaped courtyard with a spa and barbecue area.
As part of its green program, Lee Homes kept the façade of the original structure and recycled half the waste produced during construction.
Big Winner
Credit: Courtesy Pulte Homes
Project: Sun City Carolina Lakes; Location: Ft. Mill/Indian Land, S.C.; Developer: Pulte Homes, Bloomfield Hills, Mich.; Builder: Del Webb, Bloomfield Hills; Rate of sales: 376 closings last year; Price range: $167,900 to $306,900; Product type: Single-family detached, townhomes, and carriage homes
Sun City Carolina Lakes, a Del Webb community, outsells every other project in the Charlotte, N.C., metropolitan area, according to the market researchers at MORE. In fact, with 376 closings in the last year—31 per month—this one community accounts for more than 4 percent of all the new-home sales in Charlotte.
With 3,400 homes planned, this project may only be one-third the size of Sun City Grand in Phoenix at build-out. But it’s still massive as far as master planned communities go. The amenities include 1,512 acres of woods and walking trails, 10 lakes and ponds, and a golf course that’s woven throughout the community.
The thirteen homes featured in the model park take away most objections about home elevations and floor plans. The best-selling model, Willow Bend, belongs to the Summit Series of detached single-family homes. Townhomes and carriage homes are also available.
The big draw here, though, is the promise of the good life. Brochures invite prospects to take advantage of more than 100 clubs, continuous social gatherings, the golf course and clubhouse, and the opportunity to make new friends. The community centers around The Lake House, a 40,000-square-foot recreation center with everything from a state-of-the-art fitness center, to an indoor walking track, to craft rooms.
Making Some Infill Magic
Credit: Courtesy Spotlight Home Tours
Project: Byers Place; Location: Denver; Developer/Builder: Arcadia Properties, Denver; Rate of sales: Four of 19 homes since May; Price range: $450,000 to $630,000; Product type: Single-family
With its mature landscaping, short walks to stores and entertainment, and close-in location, Washington Park is the kind of established neighborhood to which many Denver families aspire. Arcadia Properties has tapped into this desire with 19 new homes that blend into the neighborhood fabric.
The local infill specialist quickly sold four of the five LEED-certified homes in the first phase and has reservations on half of the second phase. So far, buyers are jumping on the plan in the middle at 2,230 square feet. Also available: a smaller ranch plan and a 2,744-square-foot, four-bedroom home. Prices start at $450,000.
Arcadia built the first five homes on spec, waiting until they were complete before selling them. Principal Mark Bethel believes the decision not to presell from plans gives him a competitive advantage. Buyers, he believes, can’t visualize a finished home from plans and description.
The strategy worked. Three homes sold quickly, and a fourth sale is in negotiation. “We had our first two closings yesterday [on Tues., Aug. 25],” says Ann L. Atkinson of Fuller Sotheby’s International Realty, who is handling the sales, “and it’s quite exciting to think that people slept there last night after two years of planning!”
Denver architect Charles Downing designed large, well-insulated windows on the south side to provide sunlight and garden views. The homes feature open floor plans, with large master suites and finished basements. Front yards will be a continuous lawn along a public sidewalk, with beds of shrubs, perennials, and ornamental trees.
A Stoneybrook Ending
Credit: Garth Francis
Project: Stoneybrook At Venice Manors; Location: Venice, Fla.; Developer/Builder: Lennar, Miami; Rate of sales: 20 since June; Price range: $244,900 to $349,900; Product type: Single-family
You have to look long and hard to find a fast-selling project in Florida, where talk of recovery still sounds to many like wishful thinking. Then comes a report that Lennar sold 20 homes in a month and a half this summer at Stoneybrook At Venice Manors, a four-year-old gated community near Bradenton/Sarasota, Fla. How could this happen?
A new, lower pricing structure partly explains the success. When Stoneybrook At Venice first opened in late 2004, you practically had to win the lottery to buy a home. Prices escalated during the housing boom to the point where buyers may have paid $200,000 more than they would today for similar square footage.
Lennar has taken some heat for lowering prices in this 900-home, master planned community. But now it has stimulated activity and some local buzz by offering a three-bedroom home at Stoneybrook At Venice Manors for as little as $244,900. And it gets you access to the kind of country club amenities for which you’d usually have to pay much more.
Matt Devereaux, director of sales for Lennar in Southwest Florida, believes the lifestyle here, which you’d normally have to go to an active adult community to find, has a lot to do with the project’s success. “We have … all the amenities of a luxury island resort,” he says.
Indeed, this would be a great place to live whether you’re an adult or a kid. The community center includes a resort-style swimming pool, a kid’s splash pool, and an in-line skating park. For grown-ups, there’s a health club with an on-site activity director and four lighted tennis courts. For kids of all ages, there’s a basketball court, two sand volleyball courts, and a multi-purpose sports field.
Putting Buyers First
Project: Paradise at Ironwood Crossing; Location: Pinal County, San Tan Valley, Phoenix MSA; Developer/Builder: Fulton Homes, Tempe, Ariz.; Rate of sales: 21.5 per month from March through July; Price range: $116,900 to $148,900; Product type: Single-family
Altruism. That word perhaps best explains the success of Paradise at Ironwood Crossing by Fulton Homes. In a rare scenario, sales agents here put the clients’ interests ahead of their own—they offer to help prospects through the process of buying a foreclosed home or a short sale.
Fulton Homes hopes, of course, that prospects will eventually lose interest in buying a distressed home and buy a new one. And that’s exactly what’s happening, to the tune of 21 homes sold per month since March in one of the worst markets for new homes in the country.
“These buyers may spend five months looking at foreclosures and eventually bid on one for $110,000,” says sales manager Dennis Webb, explaining how the process works. “Then they find out they can get a new home from us for $106,900 with a full warranty. It’s an easy decision to make.”
In some cases, Fulton’s foreclosure specialists will serve as real estate agents to people who go through with the purchase of a distressed property. But on its website, in a “foreclosure calculator,” Fulton also informs prospects how much it might cost to replace the drywall in a foreclosed home, or even evict current residents.
When Fulton opened the project in June 2008, prices started at $149,900. Nothing happened. When prices were lowered to $129,900, still nothing happened. Then, in March 2009, the company impaired the land and lowered prices to $106,900.
“The next month they had 21 sales,” says Allison Routson, a regional manager for Hanley Wood Market Intelligence in Phoenix. “Each month since March, they have inched their prices up by $1,000. Then in August, they increased them by $6,000.” Prices are back up to $116,900, and Fulton is getting ready to start a second phase in the 2,100-lot community.
Webb says that the community benefits from a prime location in San Tan Valley. A strong entry monument gets their attention, and once they drive in, they learn that the community has an aquatic center. Plus, all the homes, even at the entry level, are certified by Energy Star. “You can’t get that in a foreclosure,” he says.
A Tall Order
Credit: Pappageorge Haymes Partners
Project: 1600 Museum Park; Location: Chicago, South Side; Developer/Builder:Enterprise Cos., Chicago; Rate of sales: 4.85 per month in 2009; Price range: $273,000 to $750,000;?Product type: Condos
In Chicago, where new-home sales in communities of 10 units or more are off by more than 50 percent this year, there’s still some life downtown. 1600 Museum Park, a 53-story condominium in South Side, has a strong pulse. It’s located within walking distance of the Chicago Loop and Lake Michigan.
With half its 274 units sold, the project has seemingly benefited from a flight to quality. “It is doing significantly better than other Chicago condo projects that don’t offer the same prime location and amenities,” says Michael Hart, a regional manager for Hanley Wood Market Intelligence, adding that luxury condo projects in general seem to be outperforming other condos.
The 1600 Museum Park tower is one of four towers in the ambitious Central Station project. Designed by the Chicago-based architecture firm PappageorgeHaymes Partners, it cuts a strong architectural profile, with its floor-to-ceiling glass and innovative shape. It is the second tallest all-residential building in the U.S. Only the Trump World Tower in New York is bigger.
The tower includes all the luxury amenities that buyers in a building of this stature would expect—exercise rooms, indoor and outdoor pools, a sauna and spa, indoor heated parking, and a 24-hour doorman. The units offer killer views of the lake, the city, the monuments, and acres of parkland.
A one-bedroom apartment here, though, goes for as little as $273,000. Two bedrooms, plus a den, start at $365,000, and three bedrooms begin at $640,000. Upgrades on the smaller condos can run prices as high as $750,000.
Even so, these are pretty low starting price points, given the location and amenities, Hart points out, adding that pricing has held pretty firm despite the downturn. In August, there were only three units in the building listed as rentals on the MLS.