By Christopher Jones
Many homebuyers wonder whether it’s wiser to invest in building a custom new home from scratch or to purchase a portfolio home with pre-set elements. While it tends to be more expensive to secure an architect to design and build a unique home, buying one with pre-set features may not be as satisfying in terms of aesthetics, scale, livability, and craftsmanship in the long run, though it can yield a more profitable real estate investment.
According to the Northern Virginia Realtors Association, for the year ending in August 2019, average home prices for Falls Church soared to $801,342. Zillow notes that “Falls Church home values have gone up 2.2 percent over the past year.” Rising home prices in the Falls Church area incentivize new home shoppers to maximize the square footage and features they purchase to yield maximum assessment value.
So, new home buyers tend away from fully custom designed projects they might otherwise dream of taking on, toward purchasing portfolio homes.
What advantages come with a portfolio home?
According to the National Association of Home Builders, these firms “build all types of housing; and generally build for all price points.” As “production builders,” they tend to produce a high volume of similar home types per year, “based on a library of floor plans.” Because they are so large-scale, they can negotiate substantial discounts on construction materials and take full advantage of a wide range of in-house services to increase efficiencies and bring down overall costs.
For Jennifer Landers, the President of New Dimensions Inc. headquartered in Fairfax, the choice to invest in a new portfolio home makes the most financial sense for new home shoppers.
“We really do have a wide variety of homes” in size and price, she said, “and we do that so we can provide an easy entry point for any budget.”
New Dimensions customers can select one from a set of 30 pre-set “portfolio designs,” or, they can choose to slightly tweak one of those designs, or, they can start from scratch and, for a higher price, order a complete custom design. Among the great benefits of pre-set designs, she emphasizes, are predictability, efficiency and lower cost
“We’ve built our portfolio designs over and over, so we know, down to the nickel, what is involved.”
New Dimensions’ website showcases a range of attractive home models with their cost-per-square-foot prices (land not included). For example, their more affordable 1,967 square-foot home,”The Madison,” lists, with 3 bedrooms and 2.5 baths, at a turn-key price of $294,900. And, their larger 4-bedroom, 3.5 bath model, “The Berkshire,” lists at a finished price of $339,900.
For custom architects, however, the stock portfolio home is not necessarily an attractive investment. Chief architect and owner Jeff DuBro of DuBro Architects and Builders on S. Maple Ave. in Falls Church, rejects the notion that people should want to live in “soulless” and unsustainably large pre-planned dwellings that tend to blight the distinctive architectural heritage of the community.
“The experience of our Homes is a holistic one that has deep-rooted meaning,” Dubro’s website proclaims, “Architecture can enrich how we live; it can strengthen our connections to nature and each other; it can improve the function of our daily tasks; and, it can enhance healthy and sustainable living. Our Homes can be alive — teaming with life and engaging our senses. This is Living Architecture.”
For DuBro, the idea of comparing fully customized homes against templated portfolio homes based on estimates of costs-per-square-foot is a misleading venture. Although he acknowledges that a custom designed home may be 15-20 percent more than what a buyer might otherwise spend for a portfolio builder.
However, DuBro counters by noting that the return on investment is going to be much larger in terms of the quality of life equity and the long-term market value. He points out that when his firm designs a smaller scale and more sustainable living space, customers enjoy a better lived experience. Equity, he argues, is about more than a bank appraisal.
“We want to build homes that are truly homes where you can build the experiences that make a home special and truly a home with a capital “H,” he states, “If you can do that in a way that is special to you as a homeowner and at the same time build real market value with a truly distinct property then that’s totally a win-win situation.”
DuBro emphasizes that a family’s quality of life can be increased by scaling to the family’s unique economy. “Quality of life happens on many different fronts,” he emphasizes, “and it’s important to think of scale and proportionality including how the house fits into the fabric of the neighborhood it’s in.”
At the architectural firm Greenspur on Broad Street in Falls Church, founder Mark Turner acknowledges that the templated home may be cheaper but argues new home customers should still explore the fully customized option, both for themselves and the community. “While there is definitely value-added to using a templated model, that’s not the kind of business we’re in,” he said, “Our reservation is that it’s not fun for us to build, it’s not unique, and it certainly takes away from the overall character of certain small towns.”
Turner sees a generational trend with both millennials and baby boomers turning toward smaller scale customized homes built with craftsmanship, unique design and proportional scale. He has heard many customers say, “I don’t want a 5,000 square foot home as much as I want a well-designed 2,000-3,000 square foot home. I want to be close to my kids.”
Turner is passionate about trying to design homes for customers who share a longing for pleasurable home living spaces rather than seeing their homes as simply a place to reside while building equity. “These people are doing it for the long haul,” he says, “They’re designing spaces for their families to grow old in and they’re not left with a big house when their kids go off to school…. They’ve got a real love affair with their house.”
So, what is the new home shopper in the Falls Church area to do? Clearly, one must balance financial and equity needs with the possibility that a dream home, built to the proper scale and proportionality, may be within one’s grasp.