Real recovery? Belvedere, Old Trail cite building booms
Realtors say they're seeing positive signs. New construction starts and sales have jumped in the past year, say the management of two of the county's most audacious mixed-use developments, Belvedere and Old Trail. Are we really leaving the real estate bust behind, or have we just been down so long it feels like up?
"It's hard to know or say with confidence where we are until we have hindsight, but right now, things are looking pretty good," says local real estate blogger Jim Duncan, a broker with Nest Realty.
Among the good omens Duncan cites are improvement in three measures of a market's health: volume of sales in the city and county are both up from last year by 15 and 10 percent respectively for the months of May, June and July, as is the median price– up eight percent in the city and 12 percent in the county. And the supply is down considerably from last year for the entire Metropolitan Statistical Area, which comprises the city of Charlottesville, and Albemarle, Nelson, Fluvanna, and Greene counties, dropping 13 percent from 2,528 listings in July 2011 to 2,200 in July 2012.
"That's good," says Duncan, but muses that there could be a flip side.
"It's also not so good because it's an indicator that there are people out there who could sell but are choosing not to," he explains. When enough people believe the market has made a sufficient recovery, those hold-outs could flood the market, Duncan says, something he fears will "extend the recovery time for years and years."
Another potential recovery-blocker is the number of houses owned by banks through foreclosures. Some are vacant, some are occupied, others are in various stages of repossession. Duncan would like to see those houses put up for sale sooner than later.
"The faster they come on the market," he says, "the faster we can burn through them and seek a truer recovery."
While signs point to a recovery in its infancy, its effects are already being felt at two massive developments born in the glory days of the real estate bubble.
Four years ago, the Hook called Belvedere a lonely utopia. Today, however, the town center, known as The Village, has recently broken ground, townhouses are under construction, and the 294-unit luxury apartment complex, The Reserve at Belvedere, stands nearly complete– and quickly rented.
"For all its challenges, Belvedere is doing great," says developer Bob Hauser, who says that Phase 1– the first 117 houses– is almost complete.
Another positive sign for the planned 775-unit development off Rio Road was the recent purchase by the Senior Center of a six-acre commercial parcel in Belvedere (to which the Center will eventually move from Pepsi Place near U.S. 29).
"I'm a cynic," notes Hauser, who says he's resisted making optimistic predictions over the past several years, but is now feeling differently. "This time around, I think it's actually coming back," he says. "It's been going on long enough now that I think there's some momentum."
That's also the sentiment from the development manager at Old Trail, a Crozet-area community with a similar New Urbanist– or what the County calls "neighborhood model"– aesthetic.
"There's definitely a feeling of change in the market," says Dave Brockman, who works for Old Trail's parent company March Mountain Management. Brockman took the job of overseeing Old Trail six weeks ago as part of a restructuring effort that gave him control of the development long managed by the Beights Corporation.
Already, says Brockman, he's seeing big results: 40 single-home lots and 19 townhouse parcels under sales commitment to builders. With only 300 of a possible 2,000 units completed since 2005, that would mark 20 percent growth; and more sales, he says, are on the horizon.
"It's a tremendous amount of activity," says Brockman, mentioning plans to double Old Trail's commercial center, which is already home to three restaurants, an ACAC satellite gym, medical offices, and a hair salon.
With the third quarter market report looming at the end of the month from the Charlottesville Area Association of Realtors, new growth figures could back the emerging anecdotal evidence. But it'll take a while before he relaxes, Brockman says.
"As developers, we all go forward with an air of caution," says Brockman. "We don't get too far ahead of ourselves."