I live in Arapahoe Ridge in East Boulder County, and I’m surprised by a combination of two things.
One is that the existing homes market continues to rise, and days to contract continue to go down. The other being that at the same time, we are seeing an explosion of new home construction in Louisville, Lafayette, and Erie. There really are new homes in Boulder County coming along.
My knee jerk reaction was that existing home values and desirability should wane in the face of new homes, but since that’s not happening, I decided to start digging. My first stop was the new homes being constructed by Meritage Homes at Flatiron Meadows on Erie Parkway between Highway 287 and 119th Street.
A tour of their models revealed some nice floor plans ranging from about 1,800 square feet to about 4,100 square feet, with base prices ranging from $360,000 to $520,000. Having been involved in new construction in the developments I represented in the past I have a critical eye for layout, flow, amenities, and construction features.
Frankly, these guys do it pretty well. Great energy efficiency, some floor plans with good flow, tall doors, and wicked nice master bathrooms. Just keep in mind that as with all new construction, the base price is atypical of the actual price the buyer will pay.
The on-site sales representative told me that the “average” increase for extras and options is running about 20% of the base price. So, that house with a $400,000 base price is likely going to end up at $480,000 or so. Add to that the expense of landscaping and window coverings, and you’re in over $500,000.
New homes have some great appeal – I’ve lived in two. Just like that “new car smell,” the feel of a new home is rather attractive to some buyers. On the other hand, existing homes in mature neighborhoods have their own appeal as well.
Though the floor plans and finishes may be a bit dated, cosmetic remodeling can be worked into the purchase price. Plus, the aesthetic of mature neighborhoods, large trees providing shade in the hot summer sun, and a lack of construction vehicles and noise are but a few of the benefits of existing homes.
But back to the point of my experiment – why and how are new homes affecting values and interest in existing homes in East Boulder County? From this one adventure I found that the new homes really are not relieving the persistently tight inventory in Boulder County. Meritage has only one home that they can deliver today at Flatiron Meadows – and that’s priced over $500,000. Their most recently-released filing is getting bought up fast and furious, and delivery dates are optimistically set for November 2014.
My final thought on the new home opportunities is to proceed with caution. While Meritage Homes has a great reputation for recognizing and respecting buyers who are represented by buyer agents, some developers are not so balanced in their practice. Adding to the confusion, some folks think that they can get a better deal with a developer if they are not represented by a real estate agent.
That’s just not true. An agent who represents you as buyer can negotiate for better pricing, better terms, and inclusion of options at no cost (among numerous other considerations). An agent can also interpret and explain the ramifications of the often 30-40 page purchase agreements, plus the mind-numbing verbiage of restrictive covenants, design guidelines, and other community restrictions.
In short, whether you’re looking to buy new or existing, be sure you bring your real estate agent with you from the first visit. Enjoy your search for new homes in Boulder County — they’re out there and waiting for you to call home.