THE 1969 DAYTONA-YELLOW Camaro parked in the three-car garage of a spec home in Charlottesville, Va.'s Old Ballard Farm subdivision is builder Mike Gaffney's lucky charm. Every time he finishes a home, he parks the sports car in the garage until the place sells.
It must be working. In a sluggish housing market, Gaffney Homes closed on 58 homes last year, 13 more than the year before. The privately held company hung onto a 13 percent market share, and its sales revenue spiked by about 18 percent, to $24 million, in a market that, like most, is saturated with housing inventory.
In fact, Gaffney Homes, which builds semi-custom and production homes, town-homes, and condominiums in Albemarle County, has more than tripled both its number of closings and sales revenue since 2003, making it the fastest-growing home builder in central Virginia.
Along the way, Gaffney, 52, grew his small staff to 30 employees and transformed himself from a builder of custom homes to one who will build whatever will sell in Charlottesville—and he'll sell it at the price Virginians are willing to pay at the time.
The result is that the company, helmed by a one-time used-book salesman, builds homes that range from $300,000 to $2.3 million in a market where the average price is $461,000. Yet the builder's focus on quality and style comes through in even the most affordable homes. “It doesn't matter what the price point is,” explains the firm's vice president and controller, Mike Ball. “We're still going to be considered the high-end builder at that price point.”
THE GAFFNEY STAMP Whether the home is a two-bedroom condominium or an 8,000-square-foot mansion with a pool, its roomy, wide-open interior bears a sleek Gaffney stamp. Gaffney Homes mixes granite countertops with stainless steel appliances and satiny wood floors in kitchens; squeezes in nearly as many bathrooms as bedrooms; and sprinkles in architectural surprises, such as pillars that separate the foyer from a formal living or dining room. The builder's favorite among the 275 homes he has built since stumbling into the business after renovating his own first home 20 years ago: “The one I'm building,” says Gaffney.
The homes fall into three categories: luxury, semi-custom single-family homes that are at least 3,000 square feet; single-family production homes that are smaller than 3,000 square feet; and multifamily homes, including condos and townhomes, which account for 63 percent of Gaffney Homes' construction activity and 42 percent of its revenue.
Last year, the firm ventured into downtown infill housing for the first time, breaking ground on 14 narrow, four-level homes on ultra-steep lots about a mile from the University of Virginia campus. “The land that's left in the city is very challenging,” notes Gaffney, who is selling the homes for $529,000.
But until 2002, Gaffney Homes kept a narrow focus on 10 or so semi-custom and production homes a year, ranging in price from $400,000 to $1 million. The year before, Charlottesville's largest employer, the University of Virginia, declared a hiring freeze just before the terrorist attacks of Sept. 11. In response to the sinking local economy which resulted, the company diversified into townhouses and condominiums that sell in the $300,000 to $400,000 range. As the market began its recovery and Charlottesville's appetite for luxury returned, the firm answered with mansions that sell for around $2 million.
Now, says Ball, “You have the best of both worlds: a company with 20-year roots in the community—we're not going anywhere—but at the same time, it is growing. There's an established feel, but an entrepreneurial spirit. At Gaffney Homes, we're pretty passionate about being entrepreneurs.”
Learn more about markets featured in this article: Charlottesville, VA.
