Homebuilder confidence has been down for historical stretches since the recession and housing market crisis gripped the U.S., but now developers are feeling more optimistic about buyer interest. One company building in Loudon County, Virginia, is so confident that it underwrote the cost of building a recent development’s pools before the homes as a demonstration of their commitment to quality. CEO Brian Cullen acknowledged his competitors thought he was crazy, but those who have already purchased homes in the new development say the pools really did catch their attention. For more on this continue reading the following article from TheStreet.
Despite a slow and cautious recovery in housing, the nation's big public home builders appear to be gaining ground...and building on it.
Both Lennar(LEN) and KB Home(KBH) reported second quarter earnings this week, both beating analysts' expectations. New orders were up strongly for both, and the CEOs each expressed Cautious optimism.
Developer Brian Cullen is also feeling optimistic about his market in Northern Virginia's Loudoun County, so much so that in his new Willowsford development, he built the community pools before the houses.
"We wanted people to see the quality of the vision that we had for the community, so we underwrote that and said we're going to make a statement and we're going to make sure that these pools are really well done so that people can see that Willowsford is all about," Cullen said.
It was also a way to separate him from the competition, who he admits might have thought he was a bit crazy. Cullen is working with Beazer Homes(BZH) and Hovnanian(HOV), as well as a few other private builders. He plans a community of over two thousand homes.
Cullen's optimism is not unfounded. Loudoun County was the fastest growing county in the United States before the housing crisis, and it still has the top median income in the nation. The county is home to Dulles Airport, AOL and several other technology companies. Home sales in the county are up over 26% from a year ago and prices are up over 3%.
"We are seeing a lot more confidence in our buyers today, and we may need to get through the election to get a full blown confidence, but it's very positive right now," Cullen added.
Allison Sherry felt confident enough last winter to put her home on the market, and after one failed contract, she sold it pretty quickly. In May she moved in and moved up to a Willowsford home.
"We were one of the first homes in, and that's a situation where you can look at the lots that are available and really be able to choose the one we wanted to get," Sherry explained.
She was also drawn to the amenities, like the pool and the adjoining farm. Rather than the usual golf course, Cullen's development offers residents fresh produce that can be delivered right to the community center.
This article was republished with permission from TheStreet.