Demand and lack of land drive teardown trend

Limited lots within the Interstate 485 beltway are putting on pressure on builders to creatively meet the demands of consumers who prefer urban living. In some cases, that means tearing down existing buildings, and reconfiguring lots to accommodate more than one structure.

“About two out of every three homes I’ve built this year has been a teardown,” said Matt Ewers with Grandfather Homes. He estimates he’s demolished about a dozen homes in neighborhoods close-in to the city this year to create vacant land where he can build speculative homes.

Most of the activity has been in Elizabeth, Plaza Midwood, Chantilly and Myers Park.

“We get a lot of interest in these properties (from homebuyers) prior to even finishing the construction,” said Ewers. While there is no precise demographic group that is attracted to the new homes, many are people who are relocating for work from the Northeast and Midwest, he said.

“They’re looking to be within walking distance to parks, schools and restaurants,” Ewers explained.

The level of activity in tearing down and building new homes matches that prior to the recession, but the volume of work it’s creating for builders is being driven less by sheer demand than by fewer active builders who survived the downturn, according to Ewers.

John and Sarah Gaither each owned condos in Dilworth before getting married and starting a family. They knew they wanted to stay close to town in a neighborhood with other young couple. Ewers told them of an estate sale in Chantilly that might fit their needs.

“It’s a really great walking neighborhood,” said Sarah Gaither, the mom of a toddler. “You can walk to the park.”

The 900-square-foot home was 60 years old and “wasn’t really worth saving,” said Gaither. So the couple hired to Ewer in 2012 to build them a larger 2,300-square-foot Craftsman home with three bedrooms, a big front porch and a southern-living floor plan.

“It’s getting harder to find dirt and inventory for clients,” Bryan Alenky with Carolinas Revitalization believes. Many of the desirable lots for construction in close-in city neighborhoods within the beltway were developed prior to the recession in “the go-go days prior to 2007,” according to Alenky.

An added hurdle is that more builders are jumping into the subdivision business as consumers demand homes closer to Uptown.

Alenky calls the process of identifying a suitable property challenging as well because of the regulatory requirements having to do with density, frontage and other restrictions. What he’s done on several occasions in Cotswold, NoDa and Plaza Midwood is basically rotated the lots, thereby turning land with two structures on its side in order to accommodate three new homes.

“We’re building up more than we’re building out; putting up 3,500-square-foot homes on 75- to 100-foot lot widths, using more efficient floor plans,” he added.

And the new homeowners generally are fine with having less yard space. “They want porches so they can have more of a sense of community,” says Alenky.

There are other drivers in the teardown boom. John Tammaro with Simonini Homes said that in 2010 and 2011 there was a pent-up demand for new-home construction that absorbed much of the vacant land. Buyers looking for a million-dollar property are having trouble finding what they want, so they prefer to tear down an existing home and build what they want. Some consumers are also finding that an extensive remodel does not make economic sense when compared with demolition and starting fresh.