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Modern in the South Suburbs?

by Christi Glendinning last modified May 12, 2005 03:17 PM
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Modern in the South Suburbs?

Posted by Christi Glendinning at May 10. 2005

Looking for feedback from the Dallas Modernist community.

We have a few acres available for residential development in the DeSoto/Glenn Heights area.

The working concept is to do something modern, affordable and efficiently designed around $140-$160K.

The concern is that the location is not appealing enough. The site is 15-20 minutes south of downtown Dallas, one mile west of IH-35. New homes in the area are selling very well in the $120-$200 price range. Was primarily rural land and mobile home parks, now building out with Pulte, Grand Legacy Homes. Site has DART bus service (DART park ride is less than a mile away).

Any comments appreciated

Re: Modern in the South Suburbs?

Posted by Mark Meyer at May 10. 2005

Are you talking about doing a small subdivision of modern homes? Or just a single family residence? It sounds like an appealing enough site at least based on distance and area, although the rural nature may not hide it very well from the prying eyes of the Pulte/McMicroMansions (and vice versa). I think you would find though that you could make the numbers work (assuming you were talking about a small subdivision) well enough that you could hit your price point of $160K and still make a decent enough profit, especially if you attacked the problem in a similar manner that Pulte does, ie. offer limited floor plan variations, but really try to nail the market, and offer up what folks are looking for. Of course this would mean defining the particular niche, to differentiate the product from the rest of the schlock, but that shouldn't be hard. You could always use LiveModern as the sounding board for what folks in that region are looking for.

I'd certainly be interested in hearing more about the MO for what you are thinking about.

Mark Meyer

Re: Modern in the South Suburbs?

Posted by Jeffrey Rous at May 11. 2005

If you are going to do this, I think Modern is your best choice for a couple of reasons.

First, you will never be able to compete with Pulte, Grand and Legacy on price. The big guys can sell 1500-2400 sqft homes for the $120-$200 you mention (about $80/sqft for the house and lot). The best you will be able to muster on the scale you are talking about (assuming you are the developer and hire a builder as opposed to doing the contracting yourself) is about $100/sqft (maybe as low as $90) for construction. Your profit and to cover the value of the land would be on top of that.

Say a lot is worth $20,000 and your time another $10,000 per house. For a 1500 sqft house, that adds $20. So you need to sell the houses for about $120/sqft. If you want to compete with the developers in your area, you need to offer something they do not. Modern houses might do that. I guess you could try to out-McMansion them, but in a 20 minute visit from prospective buyers, I doubt they are going to see the quality you have.

But can you sell a 1500 sqft house for $180k down there?

You might be able to get the price down if you do what Sara Sage is doing in california (see her blog). I think they are getting the house installed on there lot for about $90/sqft.

But let us all know, how many houses you have room for and what other ideas do you have?

Re: Modern in the South Suburbs?

Posted by Christi Glendinning at May 12. 2005

Here is some additional info on our Glenn Heights property. Consists of two separate tracts totaling apprx. eight acres.

Tract 1 is a 3.62 acre site that with current zoning would allow up to 18 - 50' x 125' lots. Based on the 18 lot scenario - lot prices would be around $20,000.

Although we have several home builders interested in doing a typical tract home product, we were hoping to use this property as a laboratory for affordable modern development. If it can work here - it can work anywhere.

Our current thrust is to refine the site plan and hopefully lower lot development costs while working on the marketing and research to determine whether this market and site could support a premium for something different, energy efficient and well designed.

Brutal honesty about the area's potential for this concept would be appreciated.

Re: Modern in the South Suburbs?

Posted by Jeffrey Rous at May 12. 2005

Can you give enough of a location so that I can Mapquest it? 15-20 minutes from downtown sounds close enough that location would be an asset, but is that a Sunday evening drive-time?

Now that you are talking about 30+ houses, I think the possibility of $90/sqft is there. 1500-2000 sqft houses for $160k-$210 modern houses might compete with the other developments.

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