FRONTLINES
Property values
New Urbanism: Show my house, please
Are real estate practitioners sour on New Urbanism?
You know New Urbanism. That’s the design trend that puts a premium on traditional, community-friendly development: wide sidewalks, front porches, rear garages and alleys, and plenty of green space for neighbors to congregate. Units may also run a little smaller than in conventional suburban neighborhoods.
Walt Disney’s five-year-old community of Celebration, near Orlando, Fla., is probably the best-known traditional neighborhood design development. The Kentlands, a six-year-old community in southern Maryland near Washington, D.C., is another with some name recognition.
It’s hard to imagine that practitioners could think that such neighborhoods are anything but the best thing that’s happened to communities since municipal water systems.
But at least one developer thinks otherwise. He believes practitioners are skeptical about these new communities holding their own in the resale market.
“We discovered this [concern over resale value] when we noticed that traditional neighborhood design communities were receiving fewer visits from [real estate practitioners] than conventional communities with comparable locations and price ranges,” said John Rymer, vice president of national sales and marketing for Morrison Homes, Alpharetta, Ga., in a column he wrote for the June 2001 issue of Builder. “We found that some [practitioners] actually steered customers away from these neighborhoods because of a perception that they had poor appreciation potential.”
That comes as a surprise to some practitioners, including one whose primary market is Celebration.
“Home price appreciation is really good here,” Kim Hawk, a sales associate with RE/MAX Properties Southwest, Orlando, told REALTOR® Magazine. “I bought my house in the original lottery for $250,000, and it appraised at $435,000 last year. And now that the landscape is maturing and the community’s social fibers are getting stronger, appreciation will just get better.”
Donald May, regional vice president for Weichert, REALTORS®, in southern Maryland, has seen the same thing with The Kentlands. “I haven’t seen anything to suggest that The Kentlands won’t follow in the footsteps of Montgomery Village, where values have held up well compared with houses in other neighborhoods.”
Still, some people won’t be convinced. “It’s possible there are areas where practitioners are hesitant,” says Steven Bodzin, director of communications for the Congress for the New Urbanism. “It takes some time for people to understand there’s more to life than square footage.”
For the skeptical, there are now hard numbers showing the resale attraction of New Urbanist homes.
Using sales figures from three New Urbanist communities and three comparable conventional neighborhoods, Rymer’s company found that over the three years ending in 2000, resale values in the New Urbanist communities climbed an average of 2.5 percentage points higher than in the conventional neighborhoods.
That makes practitioners’ marching orders clear: Get out there and show those properties. “Once people come out to see the communities, they realize what a great place they are to invest in,” says Hawk.
Learn more about New Urbanism design at the Congress for the New Urbanism at www.cnu.org.
ONLINE
What’s your view? Vote on how you think houses in New Urbanist communities appreciate relative to those in conventional neighborhoods. At the realtormag.com home page, see Ballot Box.
