2 Average Consumer Lot Costs Average Consumer Lot Costs Virginia - - PDF document

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Old Dominion University Old Dominion University Hampton Roads Real Estate Hampton Roads Real Estate Market Review and Forecast Market Review and Forecast 2005 2005

Presented by: The Center for Real Estate and Economic Development

Old Dominion University Old Dominion University Hampton Roads Real Estate Hampton Roads Real Estate Market Review and Forecast Market Review and Forecast

Residential Market

Presented by

Van Rose

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R e s a l e N e w C o n s t r u c t i o n

10 Year History of Resale and New Construction Closings

• 7,265 Building Permits
• 5330 Closed New Home Sales

Permits Closings

2003 2004 2003 2004

7049 7265 4843 5330

Hampton Roads Housing Stats - 2004 Hampton Roads Housing Stats - 2004

• Average Price of SF New Home

$313,972

• An Increase of $56,624 or 22 %

in one year

• Average Price of SF Existing Home

$207,527

• An Increase of $34,654 or 20 %

in one Year

Growth of Home Sizes & Price Per Square Foot

2002

$170K $79 SF

2150 SF

2003

$258K $104 SF

2480 SF

$313K $118 SF

2004

2647 SF

2005

$398K $142 SF

2800 SF

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Market Share 1994 vs. 2004

1994 2004

NC NC

Resale Resale

64% 36% 14% 86% $270,338 $365,384 $95,046 $225,871 $333,778 $107,907 $220,339 $314,936 $94,597 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 VB Ches Suff Resale NC Diff

Southside Resale VS. New Construction Average Closing Prices for 2004 Single-Family Detached Homes

$124,354 $242,101 $117,747 $164,984 $248,363 $83,379 $256,795 $310,230 $53,435 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 Ports Norf I/W Resale NC Diff

Southside Resale VS. New Construction Average Closing Prices for 2003 Single-Family Detached Homes

$118,791 $240,363 $121,572 $156,825 $258,726 $101,901 $320,599 $300,018 $20,581 $277,145 $299,073 $22,664 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000

H NN JCC YC Resale NC Diff.

Peninsula Resale VS. New Construction Average Closing Prices for 2003 Single-Family Detached Homes

Average Consumer Lot Costs Chesapeake

$483,879 $461,433 $493,420 $807,068

• Greystone - $117,146
• Ravenna - $127,509
• Cahoon Plantation - $151,300
• Edinburgh - $181,805

Average Consumer Lot Costs Suffolk

$700,000* $354,418 $354,146 $533,316

• Governors Pointe - $199,492
• Nansemond River Estates - $87,996
• Hillpoint Greens - $125,916
• The Riverfront - $179,591

* Projected Average Price

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Average Consumer Lot Costs Virginia Beach

$555,655 $661,379 $656,328 $654,516

Lago Mar – $169,698 Mansfield Farms – $272,766 Bay Hill – $279,000 Indian River Plantation -$194,529

Average Consumer Lot Costs Peninsula

$336,689 $326,900 $476,382 $423,782

H Howe Farm– $85,825 N Port Warwick – $91,661 J Fords Colony – $129,028 Y Running Man - $89,717

RESIDENTIAL HOUSING FORECAST

• 1. Extremely Positive!!!

RESIDENTIAL HOUSING FORECAST

REASONS:

• 1. Hampton Roads Economics

Hampton Roads Economic Stats - 2004 Employment has Grown Faster in

Hampton Roads Than In The U.S. and Virginia Since Late in 2000

Hampton Roads Has Been Buffered from

Recession by Increases in Military Pay and Housing Allowances

Median Family Income

National Average $ 43,300 Chesapeake $ 55,900 Virginia Beach $ 60,611

Average MSA Military Pay $ 52,600 Estimated 53,000 Retired Military in HR

RESIDENTIAL HOUSING FORECAST

REASONS:

• 2. Hampton Roads Housing Demand

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Percent of Households That Purchased A Home in 2004 Compared To The Total Number of Households In The MSA

Charlotte NC MSA

Hampton Roads MSA

Total Closings = 32,985 11 % of HH Total Households = 273,561 Total Closings = 28,630 5 % of HH Total Households = 581,578

Raleigh/Durham MSA

Total Closings = 43,587 8 % of HH Total Households = 506,000

RESIDENTIAL HOUSING FORECAST

REASONS:

• 3. Hampton Roads Housing Supply

Number of Homes Listed in December 1998-2004 and January 2005

8582 6902 6449 5200 4082 2925 2764 2401

2000 4000 6000 8000 10000 1998 1999 2000 2001 2002 2004 2004 2005

RESIDENTIAL HOUSING FORECAST

REASONS:

• 4. Effects of Interest Rates

(Mortgage Instruments)

Interest Rate Affect On Housing Affordability

1999 2000 2001 2002 2003 2004 MI $39,704 $42,448 $51,000 $53,900 $56,302 $56,624 IR 8.2% 7.3% 7.3% 5.5% 5.25% 6.0%

= = = = = = TM $154,000 $173,000 210,000 $260,000 $300,000 $275,000

With Down Payment

$375,000 Interest Only $400,000 Interest Only W/ Down Payment $500,000

RESIDENTIAL HOUSING FORECAST

REASONS:

• 5. Military Influence

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Defense Spending In Billions 1990 - 2005

417 379.9 355.1 329 291 221 219 203 218 223 230 238 258 270 295 298

• 30

20 70 120 170 220 270 320 370 420

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

500 1000 1500 2000 2500 3000 3500 100K 100K-199K 200-299K 300K-399K 400K-499K 500K + 2000 2001 2002 2003 2004

New Construction Closings By Price Points 2000, 2001, 2002, 2003, 2004

• 222
• 2209

+1105 +1056 +439 +250

THAN THANK YOU! K YOU! Old Dominion University Old Dominion University Hampton Roads Real Estate Hampton Roads Real Estate Market Review and Forecast Market Review and Forecast

Presented by: The Center for Real Estate and Economic Development