With owning a home affordability getting better and home mortgage rates still near historic lows, the timing could be perfect for buying a new home. And in this relatively flat market or marginally up (at least inside the Washington DC beltway – Bethesda, Chevy Chase, McLean, Arlington, Falls Church – specifically) market, there are many options to consider. But before you start contemplating about the home style and number of bedrooms, here’s a real quick overview of some segments of the Maryland, Virginia Washington DC housing market.
1. “Resale” homes probably represent the biggest percentage of the market. Built years, or even decades ago, these homes were designed and built to reflect the requirements and the tastes of previous owners. They may be outfitted with outdated fixtures and technologies, and have poor construction. Buyers of these homes often fall in love with them for their character, their location or their “good-enough” fit with their needs, and accept the necessity of investing additional time and resources in remodeling and rebuilding.
2. “Spec” homes are built based on the speculation that a buyer can be found during or shortly after construction. These new homes may be designed with up-to-date floor plans and features to fit current preferences. When acquired before completion, a buyer may be able to select some finishing touches. But this type of home construction may also be designed to minimize cost and get the largest proceeds for the home builder, potentially leaving homeowners with less than the best materials and designs that are not as contemporary.
3.“Custom” homes are built according to the buyer’s specifications, usually on land they already own. While this type of new home construction embodies only ten percent of the market, it gives the homeowner the most control. Working with an “on your lot” custom home builder, the buyer determines all facets of home construction—from site selection to the home’s style, size and floor plan, types of windows and doors, flooring and siding, and all the details—cabinets, lighting fixtures, drawer pulls, paint colors, etc. While “on your lot” home builders are sometimes thought of as large home builders, they can also accommodate today’s trend towards “right-sizing”. These days a custom home builder may work on smaller homes starting around 1500 square feet. Benefits include keeping material and labor costs to a minimum (potentially in the low $250,000 range), and customizable floor plans. In keeping with price sensitive and “green” lifestyles, another benefit of working closely with a new custom home builder is the opportunity to incorporate the latest energy- and resource-efficient products and trends. Per the National Association of Home Builders (NAHB), “Today’s homes are built twice as energy efficient as new homes a generation ago, making them more affordable (” The latest in energy-efficient materials¹ include windows with low-emittance (low-E) glass coatings, upgraded insulation, high efficiency HVAC systems, geo-thermal HVAC systems (check this new home in Falls Church with Geo Thermal ) house wraps and tight construction. Federal tax credits for Consumer Energy Efficiency² may also be available for new home construction, covering 30% of the cost of materials and labor for systems such as geothermal heat pumps, solar water heaters, solar panels and residential fuel cells. Note that in order to qualify, these systems must be placed in service before the end of 2016.An added bonus for those considering purchases of custom homes—”Current costs (hbrnetwork.com/building-materials/construction-costs-profits-both-down-from-peak-levels.aspx) of building a new home are relatively low,”—according to Jason Dickens, president of the Athens Area Homebuilders Association. 2009 lumber and other material prices have dropped considerably when compared to 2005. “Right now is a very good time to build a house.” Also, if you’d like to delve into modular home design and construction or prefabricated home building techniques, let us know. We have a new home line of semi-custom homes coming out in 2011. So, while the acquisition of an existing “resale” or “spec” home will more than likely involve trade-offs, a custom home is a good option that offers real value in function, design and satisfaction—and the fulfillment of owning the home of your dreams.
We’re launching a new semi-custom line of homes this spring. This new line of homes will include a foundation of eight award winning new homes previously built.
We’ll be adding several new home plan styles to our foundation of eight, that our market research has indicated, the Washington DC market is demanding.
The new home designs coming out in the spring will be the result of focus group studies and interviews with our clients and home building prospects we have been conducting the last several months and are ongoing over the next few months.
To give you a hint of what our research has shown (it’s not what you think), here is a peak of one of the new home plans Kevin, our architect, is creating:
Here is one of many new home plans we are designing now for our new Semi-Custom home line coming out in the Spring 2011
We’ve had a large demand for first floor master suite homes and homes with just one floor. So we are in the process of designing several home plan prototypes.
If you’d like to be included in any of our studies (and possibly our model home program). Send an email to [email protected].
I’d appreciate it if you let me know below what you like or don’t like about this floor plan. And if you have any suggestions that you’d like to see added. Also, do you have any suggestions on new home plans that you’d like to see in the future, please comment below.
Business conditions stayed weak through 2009’s 3rd quarter for housing design architects, yet specific segments at the market’s lower end look ready for a 2010 recovery, according to fresh numbers from the AIA.
Since the billings for architects are usually a good prediction of future activity in construction, this could be good news for homebuilders.
Design work for affordable homes for first-time buyers jumped from -64 percent in the third quarter of 2008 to -2 percent in a year over year comparison, according to architects responding to the latest AIA Quarterly Design Trends survey. (Percentages indicate the number of respondents reporting sector ‚improving‚ minus the number reporting ‚ aweakening.‚)
The feeling towards the move-up market had an improved gain that traveled from -57 percent down to -29 percent within the same time frame.
Each market segment has been boosted through decreasing home costs and good mortgage rates. AIA cheif economist Kermit Baker noted the kick-start the affordable market received from such aid as the federal tax credit for those purchasing a home for the first time.
The third quarter of 2009 showed strong gains in remodeling activity, with 27 percent of architects reporting an increased demand for both renovations and additions, up from 13 percent in the year prior. Kitchen as well as bathroom remodeling jobs increased by a very large percentage, from approximately eight percent during 2008 to approximately twenty six percent during 2009, an increase of more than three times the percent for one year.
Additional market segments have not been as fortunate. The townhouse/condo market remained stagnant, with a score of -43 percent in 2009 vs. -49 percent in 2009. Interest in custom/luxury homes and second vacation homes remained extremely low, at -48 percent and -70 percent, respectively.
Through the third quarter of 2009, the AIA‚Äôs residential billings index rose sharply from a score of 20 in the fourth quarter of 2008 to 38 in the second quarter of 2009, but then remained flat at 38 overall. Individual scores not above 50 are indicative of negative activity, however “less bad” categories are those that show scores that are ten or above.
Moving from a score of 35 in the first quarter of 2009 to 47 in the second quarter, new project inquiries at architecture firms remained similarly meager last year, but inched closer to the halfway mark.
Geographically speaking, reports from architects suggest that recovery will be concentrated most heavily in urbanized areas. Some 69 of respondents in the latest survey indicated a rise in demand for infill development, up from 63 percent in 2008.
Do Want A Custom Home That Reflects Your Lifestyle? Not Some Cookie-Cutter House Plan You Can Find In A Magazine, But A Design That Truly Reflects Your Lifestyle? Check Us Out – World Class Architecture Designed For You. This home has 9 foot ceilings, wood floors, luxxury bath great yard – 13ksf Award Winning Architect and Builder Paramount Construction Homes Starting at $425,000 on your lot – call 301-370-6463 s 9 foot ceilings, wood floor granite tops great design Several new homes under construction – call 301-370-6463 for home tours go here for our homes for sale Or if you already have a lot and you need an award winning architect to create a set of custom home plans click here
Wheeeew…it’s over – – we had over 200 guests visit our Bethesda Open House yesterday!
I want to thank everyone for attending and I hope you liked what you saw.
First, I want to announce the winner of the Flip Mino Camera Drawing – the winner is…
…Mary H. (we’ll be contacting you today and sending out the camera) – Congratulations!
Second, I apologize for not being able to meet with everyone individually and answer your questions.
So I wanted to give you a quick FAQ below to answer some of the most common questions and least technical (which I’ll answer in future emails – like, does the $6500 tax credit apply to building a new home, can you really get tens of thousands of dollars in tax credits with a tear-down and how do you obtain a “Green” LEED rated home?).
Here you go:
Q: Did we create the architectural design and perform the construction of the new home on Berkley Street? A: Yes. We are architects and builders. Kevin is our on-staff, full-time architect.
Q: Is the home for sale or did we build it for an owner? A: The home is not for sale, the home was built for the owner.
Q: Was the home design from our Paramount Portfolio Plan Book or was it custom designed? A: When the owners were checking our references, they visited and met the owners of our Belmont Model and fell in love with that home. However, given the owners unique needs and wants and given the unique characteristics of the lot on Berkley, we created a custom design for the owners.
Q: Do we charge a premium for creating a custom design vs building a home plan from our Paramount Portfolio of over 80 New Home Plans? A: Currently, we do not charge anything additional to create a custom home design.
Q: Was there an existing home on the property that was torn down? A: Yes (we had many questions about the potential tax benefits of tens of thousands of dollars associated with the tear-down, and a subsequent email will detail the benefits and how that works)
Q: What was the price of the Berkley home and what was included? What was not included? A: Price was in the $600K +/- range and was all inclusive – demolition of existing home, excavation, permitting, blueprints, engineering, surveying, utilities, custom selections, etc.
Q: Do you take on home additions and home renovations, as well as new homes? A: Yes. Currently we have six projects of that type in process.
Q: Do you take on small remodeling projects – $50k to $200K? A. No, but given the demand, we are considering accepting a few projects on a very limited basis.
Q: I want to build a new home but I don’t have land. Do you have land or lots? Can you help? A: Yes, we have about 10 lots in Bethesda, Chevy Chase, Mclean and N. Arlington.
I hope this helped.
I’ll be sending out another FAQ in the next few days on some of the more technical issues brought up and we’re working on a video series that will answer many questions at an even deeper level, which will come out in the next few weeks.
Again, Kevin and I really appreciate your interest in what we do and please feel free to email me at [email protected] or Kevin at [email protected] or call me at 301-370-6463 with any questions you have.
Happy custom home building client in Bethesda Maryland describes her process for selecting an architect and builder to design and build her custom home.
Lots of homeowners are trying to decide of adding on to their home is better than tearing the house down and building a new home. But where do you start? Who do you turn to?
Yingjie was faced with this dilemma. So listen and watch Yingjies story.
Yingjie first met with an architect. But the architect wasn’t much help. He was not able to tell her if adding on to the existing home or knocking down and building new was the best way to go. Next, she met with a builder. But the builders home plans were unimaginative and looked like “one of those” homes that so many builders put up – B-O-R-I-N-G!!! Then, her life magically changed when she received a message one day from Paramount Construction.
Listen and watch Part 1 of her story here:
Here is Part 2 of Yingjies story and about her new Bethesda custom home building experience and how she went through the process of of selecting an architect and builder and what some of her concerns were:
Read the full interview here:
Part 1 A Life-Changing Story Yingjie Shu, of Bethesda, Tells How Life Has Changed Since Rob & Kevin Designed & Built Her Custom Home (Winner of the Gold Award)
Hint: Yingjie has Become Self-actualized due to her New Custom Home Which Reflects Her True Essence…. Ok, Maybe That’s a Bit Lofty, but She Sure is HAPPY
(R = Rob) (Y = Yingjie)
R: What is your name? Y: Yingjie
R: What is your name? Y: Yingjie
R: Where do you work? Y: U.S. News and World Report. (laughter). I really don’t know how to get started. Like you said, it took us years on debating, wrestling whether to expand our house, or tear down our house, we do love our old little house.
R:So, you….what’s your process? Y:At first, we hired an architect, the architect came here and talked to us about one hour. I thought before the guys came here that he should have ideas and at the end he would give us some ideas whether to build a new home or expand our house. So, after I talked to this architect, I still don’t have any idea.
R:Because you are just not sure whether you should knock it down or add on? Y:Yes, after we talked to him, we still have no idea. Looks like we have to pay him in order to have some ideas. At that point because we don’t know that architect, we are not willing to do that. So, we gave up that idea and started to look at other builders. There’s one builder that came over, you know, his plans, whatever, then he showed us, took us to of the some houses that he built and when I looked at that house, I’m not impressed, you know, they all looked like one of those houses up there. There is no character, you know. So, we let it go, you know and then suddenly, we received Paramount’s Open House Invitation in Falls Church, so you know, it was like winter time. So I said, hey, let’s go, let’s just check out. So, we went there. So, when we were driving close to the house, I said to Bill, ‘That’s it!” Co’z the house looks so charming from outside and then we went inside and our hat just brimming. I just said “Hey, Bill, that’s it”. We love the floor, we love the fixtures, we love the design especially the master bedroom, you know. So, at that point, I said “Hey Bill …….
R:Did you talked to Kevin or Rob there? Y:Yeah, we talked to Kevin and Rob and have some ideas. I guessed Kevin asked us, you know, what we want, what we liked at the house, whatever. So, then you came over to our house with a sketch, what our house should look like. And we discussed whether we should, you know, renovate or tear down the house. You did some analysis and you said, “Tear down, get a new one”. So that’s what we did. And then you gave us some reference to another house in DC and I went there and when I saw the house, I said, “Oh, my gosh, I love this house”. So, I said, you know, we will stay with Paramount. Build a house that has us, that has the character, has the charm, something really referencing us instead of just one of those out there. And we’re very happy.
R:Now that you’ve lived in here for…., how long have you lived here? Y:About how many…three, four months.
R:How’s your life now compared to the old house? Y:I think it’s beyond what I can say, it’s beyond. I am extremely happy, you know. I think the house is not huge but it’s the perfect size for us and the space is really well-designed, well-used, you know. Pretty much we can use every room, you know, we have in the house. We just love everything in the house. We love the windows, we love the kitchen cabinets, we love the lights, we love the wall, the shape, you know. We love the basement, we love the loft, oh, we love the floor. We just love it, we love everything.
R:How was the design process from the beginning? When we first met you, how was the process? Y:I think the process was really really easy. I think Kevin did a good job to get us through what we need to do. So, a lot of things we have no idea, you know, the color, the design, all that kind of things. He really get us to, you know, what will fit, you know, meet our need, meet our budget, you know, fit our style and everything came out well.
R:How about during the actual building, during the actual construction period, how was that? Y:It’s great, really. I think everybody is really really professional. I think the neighbors love it too, you know. The impact on the neighborhood is very minimum. And whenever we come here, we always see progress, you know,”how’s the house by the way?”. We come here everyday, we passed by, you know. So, everyday, there is some progress, you know, and we’re really happy.
R:And where there meetings on a regular basis during the construction period? Y:Yeah, yeah, we had weekly meetings.
R:You had that? How was that? Did they keep you informed? Y:Yeah, they kept us informed, really helpful. What hasn’t been done and what’s, you know, going to be done. I think that’s really really good.
R:What do you think of the quality of the work? Y:Oh, great. Oh, by the way, there was once… Because I don’t know much about building, that kind of thing. So, there was once I took a guy at work. He is like our facility manager, he came here. So, I showed him, at that time we were doing the outer trimming, you know. So, he said, “This is definitely a Bethesda house, not a Rockville house”.
R:What did he mean? Y:Quality. He said its top quality stuff. He said, “Yingjie, just relax, everything’s gonna be alright for you”. So, that made me…from a colleague, somebody I can trust, somebody who knows about facility. So, that’s really comforting.
R:Where there any unpleasant surprises or changes that came up here during the construction? Y:None that I am aware of. No.
R:How about the timeframe. How fast did it go, the construction? Did they deliver on time? Y:I think what’s really beyond our expectation, you know, I think it’s longer to get a permit than build the house, you know. But I guess the permit is just America’s deal.
R:How about the after construction service or issues that came up? Y:Oh, it’s great! Actually the part I was really impressed… couple of times, you know, Mike showed up to see and say, “Ms. Shu you need to do this”. “Oh, my gosh, Mike I completely forgot about it”, you know. It’s really really good, follow-up.
R:Has ______Zuckerman said anything about the house? Y:No. But I did talk to his nephews. (laughter) R:And are they gonna come over? Y:I told them. I said, “ I have an open invitation, come over”. R:How about the Obama children. Have they been over to play with Ray yet? Y:Not yet. (laughter) They’re too young for Ray. R:I thought Ray likes older women. Y:But they are younger. (laughter) R:They are younger? I thought they are older than him. Y:They are ten (10) and seven (7). R:Could Ray bay-sit, at least? (laughter) Y:Maybe. R:So well, when friends have their Christmas party here, will the Obama’s be here? Y:(laughter) I have to ask him. We’ll love to have them here.
R:Ken what am I missing? (video taping about to end)
Part 2 A Life-Changing Story Yingjie Shu, of Bethesda, Tells How Life Has Changed Since Rob & Kevin Designed & Built Her Custom Home (Winner of the Gold Award)
Hint: Yingjie has Become Self-actualized due to her New Custom Home Which Reflects Her True Essence…. Ok, Maybe That’s a Bit Lofty, but She Sure is HAPPY
R:You’re really on trying to decide if you should knock it down or build new, you’ve interviewed the architect, you’ve interviewed the builder. What kept you up at night? Was there any… like.. what went through your mind, if there was any fear, what was it? Before, pre making any decision? Y:I think it’s still we’re making big chance, you know. There’s a lot of money gonna be involved. We don’t’ know anything about building and even though we went to your Open House, we got some references, but still there’s risk out there, you know. So, there were period of times at the beginning, I said, “Oh, my gosh, did we make the right decision?” you know. How about the house, is it gonna come together, how about wasting all the money, co’z we hear all the stories, you know.
R:Stories like what? What’s the worst story that you’ve heard? Y:Like for example, I have a friend. Her sister is building the house, then suddenly, I think they poured the concrete in and there were cracks, you know. So, they have to stop the work, hire another contractor to pour the concrete and do that whole thing again, then re-fill it again. And eventually, they went to a, they had to go to the court, you know, that kind of things, throw the money down the drain, you know. That’s just really horrible, you know. I think, that house, their house, my friend’s sister started early in that house but then, you know, when they’re getting close to finish everything, they were still gonna finish the trimming. So, you hear a story like that or something, you know, people stopping the work for whatever reason, you know, the builder would go bankrupt, you know, whatever. And then the job is hanging there, never finished. So, you hear those kinds of stories. Or another thing is just, you know, you have a fixed price and then they keep raising the price and then saying, “We need to do this, we need to do that”, and all kinds of problems and then the price just went up, you know, dramatically and that’s kind of a nightmare too for us.
R:How did you get the comfort level that Paramount wouldn’t do that or wouldn’t go and have cracked foundations or wouldn’t have a price that they kept going up or wouldn’t build a complete job on time? Y:Well, I think when everything goes on schedule
R: But how did you make that decision with Paramount? Y:At the beginning….? R:Yeah, because how did you determine that the price was fair, that Paramount could perform? Y:Well, um, well the price of course we checked with some other builders, you know, we checked with a friend. So, we have some rough idea how much it’s gonna cost, so the price, you know, Paramount presented to us, like it fit in our budget, we can do what. And in terms of, you know, assurance of the work, we talked to the references and all the references we talked to were happy with the work, you know. So, we just feel like, you know, we checked, we checked with all the references, we checked like 4 or 5 references and every single one praise Paramount. So, we feel like, you know, we just have to take a chance. And also, we saw the Open House in Falls Church in 23rd St, we saw the quality of the house and I said, “Hey, we cannot go wrong”. So, we did take our chance but the risk is worth it and yeah, everything is just worth it.
R:Last question. (laughter) Were there things that kept you up at night during construction? Y:No. No.
According to BuilderOnline.com, Washington D.C. made the top ten healthiest housing markets for 2009. Washington D.C. actually ranked number 6.
Here is what was written about the Washington DC housing market:
Washington D.C. showed signs last summer that it might be emerging from the downturn, then it turned south again. Even so, the area produces a ton of jobs—an estimated 35,000 in the last year—that fuel a vibrant housing market, the 11th largest in the country. Many of the jobs stem from contracts with the federal government. Washington D.C. remains a relatively unaffordable place to live, with a median home price of $332,700 in the third quarter of last year.
One prime reason the of the ranking is that the population in Washington DC area has grown around one percent each year for the past five years.
The home building patterns have changed as well. Many families moving to the area are demanding to be inside or immediately outside the capital beltway because the traffic is one in the nation’s worst. I live inside the beltway and I can get any where I need to go — from Washington D.C. and the Virginia and the Maryland suburbs in 20 to 30 minutes. And if I travel during off-rush house times, it may be 10 to 15 minutes.
We are even working with new home building clients that are moving down to inside the beltway from Gaithersburg, Md., Culpepper, Va., and Frederick, Md.
The BuilderOnline section is courtesy of: Hanley Wood Market Intelligence.
New Home builders, big and small, would be among the winners if the $838 billion stimulus measure the U.S. Senate passes today.
The Senate bill seems to be more generous to home builders than the House was in the $819 billion measure it passed last month.
President Barack Obama, who spoke to the nation last night, has said he wants stimulus legislation signed by this weekend. President Obama is counting on the plan to help revive the economy. The economy has lost 3.6 million jobs since December 2007. This has caused the unemployment rate to soar to the highest level since 1992.
To quote a Bloomberg wire: “In a bill this big, there are countless private-sector winners and losers,” Rogan Kersh, associate dean of New York University’s Wagner School of Public Service was quoted as saying.
The Senate cleared the stimulus proposal yesterday by a vote of 61 to 36. There were three Republicans siding with Democrats.
It’s quite possible that U.S. home builders could see sales increase if consumers tap into the planned tax credit of $15,000, or 10 percent of the purchase price, whichever is less, under the Senate legislation.
Morningstar analyst, Eric Landry said “If someone’s going to give you $15,000 in free money it has to be stimulative”.
The proposed new tax credit does not have to be repaid. And it appears that all home buyers are eligible for the home purchase tax credit. This proposed home tax credit would replace the $7,500 tax credit for first-time home buyers that was passed sometime last year. In addition to the amount of the proposed home purchase tax credit, another difference is that the $7,500 home tax credit had to be repaid over 15 years.
Jerry Howard, president and chief executive officer of the National Association of Home Builders stated, “We’re pretty happy with the way the Senate bill is shaping up. We think it will entice a lot of those people sitting on the sidelines into the marketplace.”
As a home builder building new homes in the Washington D.C. area, I feel lucky because our area inside the Washington D.C. beltway is relatively strong. Values have held up and business is steady. So I can see real benefits to home builders, subcontractors and home building and remodeling vendors.
We also work with a large number of families and individuals that are just starting out and are looking for their first home to purchase. So it will be a huge benefit to individuals and families like that. But I’m not sure it is the best thing in the long run for our economy.
What do you think? Let me know your thoughts and comments.