01-22-08 1B Market Study - Laserfiche WebLink

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FOR-SALE MARKET ANALYSIS Actively Marketing For-Sale Housing Developments Maxfield Research Inc. interviewed city administrators and developerslbuilders of single-family subdivisions and for-sale multifamily developments that are currently being marketed in the Ar- den Hills Market Area. The following are key points about these projects. Active Townhome Developments We surveyed 15 actively marketing townhome developments in the Arden Hills Market Area, however none in the city itself. The following are key highlights about the townhome market. ~ The typical size is 1,605 square feet for a two-bedroom townhome, and the sale price has averaged $235,000 in these developments. ~ The development surveyed will eventually contain about 1,450 units. At present, about 960 had sold. Most of the developments surveyed opened in 2005 or 2006, with a few in 2004. Most ofthe 960 sold units were absorbed in the past couple of years - or about 320 units annually. ~ Eight ofthe 15 surveyed developments are located in Blaine, accounting for 1,150 ofthe total units. People seeking for-sale townhomes closer to the Twin Cities have fewer choices. There is one townhome development in Roseville, one in Falcon Heights, and two in Columbia Heights, and all are smaller developments. ~ Townhome developments have a mix of styles that appeal to different market segments. The side-by-side two-story rowhome often appeals to move-up professionals, while the one-level townhome attracts seniors. The back-to-back townhome style, which is less expensive to build, tends to be sought by entry-level buyers. At present new construction has slowed or halted for most townhomes and condos, with builders reporting excess inventory of built townhomes and a large number of poured pads that will re- main empty until the market improves. These industry insiders are pointing to 20 10 as the date for a housing market turn around, with many saying they have two years of inventory at present. Many developers see a move to townhome rental rather than for-sale units for the near term. Hans Hagen Homes is building a 170 townhome rental development in Blaine and has completed townhome rental developments in Maple Grove and Woodbury. While the market for townhomes has slowed with the rest of the housing market, the developers and builders we spoke to felt that a mix of for-sale and rental townhomes both for those entering the market and for older Arden Hills residents would be appropriate. 41 MAXFIELD RESEARCH INC.