Quantcast
Home / News / Construction and Real Estate / Builders 
scrap plans for townhomes

Builders 
scrap plans for townhomes

Garden homes sprout as cheaper alternative

Harold “Skip” Tuttle’s company had planned to build 98 townhomes in the Woodlands development off Twin Lakes Road in York County.

A block from Mount Gallant Road in Rock Hill, the project includes India Hook Elementary, part of the Rock Hill School District.

But this summer, Rock Hill-based Tuttle Co., of which Tuttle is co-owner, changed gears, replacing the townhomes in the single-family project with 56 garden homes.

It’s part of what appears to be a trend in York County, where plans for townhomes are being tossed aside and replaced with single-family patio homes, also known as garden or cottage homes.

“The townhouse market has virtually died,” Tuttle said. “Three builders have decided not to include those (townhomes) in their plans for Woodlands. I’m listening to what the market is telling me.”

Tony Berry, managing member of Rock Hill-based Berry Co., says townhomes have been out of favor with consumers and lenders since 2009.

Berry’s company purchased property off Highway 274 at the site of an old par-three golf course. The property is now called Newport Lakes, and Berry’s company planned to develop it with single-family lots and townhomes for Canada-based Mattamy Homes in 2007.

Berry described what happened next as real estate market Armageddon.

“We bought the property and installed several single-family and townhome lots based on Mattamy’s desires,” he said. “Needless to say, in 2008 the proverbial wheels came off the bus for the development and construction industry. Mattamy chose to not move forward on our neighborhood, and we sat in a stalled position for almost two years.”

In 2009, Berry said, Monroe-based True Homes expressed an interest in Newport Lakes but not the townhomes associated with the project. Instead, True Homes will build cottage homes.

Driving the patio home trend could be the lower costs to build one compared with building a bunch of townhomes. The smaller lots that usually come with patio homes help keep selling prices down.

Besides costs, another draw for buyers, said Stephen Allen, planning manager for York County, is patio homes generally sit on smaller lots and sometimes can offer zero maintenance.

But between six and eight townhomes could be built on an acre, versus only three or four cottage or garden homes, which means there could be more profit for builders of townhomes. At the Lake Wylie Towns development, for example, there can be up to eight townhome units per acre, Allen said.

But, for Berry, the problem with townhomes is two-fold.

One, lenders also might be more reluctant to finance construction of a townhome because it’s very seldom that a builder will have more than one-third or half of the townhomes sold prior to construction and, two, it’s more expensive to build a, say, six-unit townhome than one patio home.

Another drawback of townhomes, some say, is the shared common wall between homeowners.

For consumers, the sluggish market has reset home prices. Between 2000 and 2007, a townhome was typically priced below a starter single-family detached home, so it was a good option for those who didn’t want to rent but who also could not afford a single-family home.

“But today, an individual can now buy a two-bedroom, two-bath, one-level, single-car-garage cottage home for less than a townhome would have sold for,” Berry said.

The townhomes planned for Newport Lakes in 2007 — although none were ever sold — were priced to start in the $140,000s, Berry said. Single-family homes were priced to start in the $250,000s.

Now, cottage homes in Newport Lakes are priced to start in the $110,000s and $120,000s, while single-family homes are starting around $150,000s.

Tuttle said garden homes in the Woodlands are selling in the low $100,000s and single-family homes are selling in the $200,000s.

Tuttle said there are 58 single-family and garden homes in development at the Woodlands. Eighteen townhomes in three buildings have been sold and are occupied.

At Newport Lakes, there have been at least 50 single-family and cottage homes built, Berry said.

But one Lake Wylie-area developer is prepared to buck the patio home trend. Jerry Plageman’s project, Lake Wylie Towns, once called Patios at the Landing, received approval this month from the York County Council to build up to 68 townhomes instead of 27 patio homes.

Plageman, owner of BPS Investments, said market conditions prompted the change. The economy is causing developers to adapt their plans on a daily basis, he said.

“I think everybody has got their eyes closed and are throwing darts at the wall and seeing where they land,” he said. “Right now, this is what these people are interested in.”

Plageman wasn’t forthcoming with details of his plan, declining to name the potential builder, saying he is still in negotiations.

When asked why his project seemed to be going in the opposite direction of other projects in the same county, he said: “I don’t know why they would be doing that.”

“The reason we’re doing it is because the person we’re talking to is interested in doing it that way,” he said, referring to the builder.

Berry said he has not heard of anyone replacing garden homes with townhomes, and he said he is happy with what’s happening at Newport Lakes.

“I’m very thankful,” he said. “I think Newport Lakes is one of the more successful neighborhoods south of the Catawba over the last 18 months.”

Ramsey can be reached at tara.ramsey@mecktimes.com.

Leave a Reply

Your email address will not be published. Required fields are marked *

*

 

%d bloggers like this: