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Understanding Vienna’s New Home Market

July 15, 2016 By Doug Francis

Town of Vienna Custom Homes

Custom Home in Vienna VA

Not all custom builders in Vienna follow the same business model.

Most builders buy lots and then figure out a model to put on it. At that point they can determine a target asking price factoring in lot acquisition, business expenses, and construction costs.

Home construction still requires exceptional project management experience to coordinate everything from digging the foundation to applying the finish coat of poly on the hardwood floor.

  • One builder mindset is to design and start a tear down or infill home before advertising the home for sale. A “spec” home. Then they can plan out the timeline, establish a certain level of quality, and limit any unexpected design changes. This strategy manages expenses and allows the builder to set precise target dates over the 10-month building process.
  • Another builder mindset is to post a sign in the yard and wait for a buyer to materialize, agree on a design, and then agree to a contract. For most home buyers, this scenario is the most grueling because so many decisions need to be made, and waiting 12 to 16-months for delivery will be stressful.
  • The final builder mindset is building custom homes only on lots already owned by their customers. These are not “spec homes”, but true custom-builds. For most Vienna home buyers, this scenario is out of reach for a variety of reasons, including the time involved and significant additional expense.

The spikes in the chart below follow factors of builders using all of these mindsets. In an effort to catch the spring market, builders will list their spec homes hoping to land a customer. If a buyer doesn’t materialize, then the builder will remove the listing and start building the house.

Vienna’s rebuilding boom

The Town of Vienna has enjoyed a rebuilding boom for years that is the envy of many communities across the country. With over 100 building permits issued and older properties being sold to builders to establish a pipeline of tear down and infill houses, Vienna is certainly being transformed.

A downside of that transformation is the elimination of single family homes below $600,000 which has been at the core of residential homes.

An upside is a significant increase in real estate values which has created real wealth for those homeowners heading into retirement.

For a real example, many homes that would have sold for $450,000 just three years ago will likely command $600,000 today. That 30% gain can go toward buying a property across the country, further fueling economic growth across the national economy.

Where are tear down and infill homes?

Our custom, new home market is a challenge to understand for the average web-surfing home shopper who has set up search criteria on multiple real estate portals like Zillow, Trulia, or Redfin.

These new homes can hit those apps in bunches… like a big set of waves (I have been on vacation) after waiting months seeing nothing of truly “new”.

I specifically included only data from a price range where new homes are priced to demonstrate the fluctuations in “active” listings.

What happens in those down-months? More about that later…

What is important for web-surfers to understand is the definition of “active” in the data results. New homes are “active” when a builder hires a Realtor who add the home into the MRIS database. And the MRIS database is the trunk, core, or main line for your apps that you have become addicted to.

One lesson many builders have noticed over the last five years (when real estate websites became much more 2.0) is that home shoppers track days-on-market and will likely shy away from homes that appear to be sitting on the market for 100 days. Their assumption is that something is wrong with the house and they won’t want to buy a reject.

It is an incorrect assumption.

Until recently, most builders listed a home before they started digging the foundation. And at 100 days, well the foundation may have just been poured!

To prevent this inaccurate tracking, most small custom builders have reverted back to old-school marketing using a sheet of paper or including an address on their web site.

Many of my clients have run the custom builder gauntlet prior to deciding to work with me because they don’t have the time anymore to wait for builder call-backs or drive around town hunting down coming-soon signs. And, many have been burned by builders who have pitted them against other buyers in auction style bidding wars.

These are good people who are burned out! If that sounds familiar, then we should talk.


When is the best time to buy infill homes?

Timing is critical, but you need to buy a home on a good lot.

Some builders don’t seem to care about lots as much as you should. The long term value of a home is influenced by location, lot size, and light exposure. You can gut an outdated kitchen, bathroom, or living room, but my other top value influencers are fixed positions in space.

In my opinion, the Fall is historically the best season to buy infill homes. One reason is that there isn’t as much pressure on the market, builders seem to have more time to talk, and some of the best lots pop up for sale. But custom homes sell here all year during every season.

The best strategy that I recommend to my clients is to be prepared and be patient. Essential elements of preparation is understanding your location needs, preferred house orientation, and what you are willingness to compromise. Understand your ideal scenario, be prepared to act, but also be willing to wait if the house doesn’t fit the bill.

Vienna’s new home market will be active for years as the region’s economy expends and population grows. There are always homes on the market that you can’t see on those national real estate portals, and understanding the type of builder you will be working with or the advantages of one part of town over another will determine the long-term value of the home you will eventually call home.

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Filed Under: Blog, Home Buyer Tips Tagged With: Home Buyer Tips, real estate, Vienna Virginia

About Doug Francis

A Realtor specializing in unique and new homes around Vienna, Virginia, Doug started writing a first-hand blog about his everyday real estate experiences a decade ago. In depth, helpful and fun has always been the objective. Outside real estate, he was profiled in a commercial for Verisign's "Where the World Clicks" campaign, and was quoted in Money Magazine's Best Places to Live article on Vienna. He's a Boston University graduate who feels morning coffee is non-negotiable.

Helping my clients add value to their home has always been important to me. My step-by-step recommendations are intended to increase market appeal, return more then invested, and help net more when selling.

Beyond just sellers, I have helped many new homeowners make smart design decisions when remodeling. We gutted our house and totally remodeled it, and I pass that experience along because living in a nice house is simply better.

My background… I’ve been an active licensed agent in Virginia for 25 years, work at TTR Sotheby’s International Realty in McLean, and sell homes in all price ranges. I donate to the Town of Vienna tree replacement fund, participate in a neighborhood citizens association, and try my best to stay in shape.

Questions? Email doug@dougfrancis.com or call me at (703) 304-6827 to discuss your plans. Cheers!

Filmed in Vienna and McLean

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Viva Vienna Vienna Idol event on the Town Green sponsored by Caffe Amouri

The Vienna Town Green

The Town Green in Vienna, Virginia is located where Maple Avenue intersects the W&OD Bike Trail and Mill Street. The Town

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About Doug Francis

I am a Realtor with TTR Sotheby's International Realty® just outside Washington D.C. in Northern Virginia. I have been a full-time Realtor licensed in Virginia since 1991, and cover a big territory specializing in the Vienna real estate market and custom homes for sale.

I have unique knowledge of digital real estate marketing, and my marketing starts here. My clients have been attracted to my results-oriented strategy for years, and I am accepting new clients for Fall 2022 right now.

Thanks for reading, and feel free to contact me at 703-304-6827 or email me at doug@dougfrancis.com anytime!

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