The Preston Lake Trustee Sale took place today (February 3, 2011) at noon, and drew quite a crowd of Preston Lake homeowners, developers, attorneys, Realtors, and neighboring landowners.  Here's an overview of where things stand....

Local History in the Making:  It's not necessarily the good type of history, but this was the first major subdivision --- and hopefully the last --- to be foreclosed on in the Harrisonburg area.  Many other areas across the country have seen multiple large subdivisions be foreclosed on, but until today, Harrisonburg had been unscathed.  The timing of the development of this subdivision is likely what led us to today's events, as the development began just as the housing market began to slow dramatically.

Only One Registered Bidder:  Only one individual registered as a potential bidder at the sale (by showing his deposit check to the Trustee, and providing his name), though he did bid during the auction, likely because of the opening bids from Wells Fargo.

Only One Actual Bidder:  There was only one actual bidder....Wells Fargo.

Surprise Rowhouse Auctions:  In addition to the 120+ acres of land at Preston Lake that were auctioned off today, four rowhouses were also auctioned separately.  This was not specifically advertised -- if it had been, I think we would have seen some actual bidding take place.  Each of these rowhouses are at a different stage of completion, but each at least has the shell completed.  The opening bids from Wells Fargo were as follows, and these are the prices at which they are taking back the properties:

• Lot 9C -- $270,600
• Lot 10B - $39,960
• Lot 11C - $157,760
• Lot 12C - $79,080

A Hefty Price For 120+ Acres:  It wasn't too surprising that there were not any bidders for the 120+ acres of Preston Lake, as Wells Fargo's opening bid was $3,500,000. 

The Common Areas:  The attorney representing Wells Fargo also indicated that the common areas would be deeded to the Property Owners Association.  The Association will still exist, and owners will still make payments to it to support the maintenance of the common areas and other common amenities of the neighborhood.

What Happens Next:  In theory, within 30 days, Wells Fargo will close on their purchase of the four individual rowhouses, and the 120+ acres of Preston Lake.  The attorney representing Wells Fargo commented to me afterward that he thinks there is a 90% chance that the sale will proceed to closing and that Wells Fargo will be the new owner.  After Wells Fargo owns the property, he indicated that they would sell the four rowhouses individually, and seek to sell the remaining 120+ acres to a new developer.  It is unclear what price they will ask for the remainder of the subdivision (likely lower than $3.5M), and it is unclear what price they will eventually take for the remainder of the subdivision (likely lower than $3.5M).  Wells Fargo's attorney also indicated that while they will attempt to sell the entire undeveloped section of Preston Lake as a whole to one developer, it is also possible that they would sell the property as individual lots or sections of lots.  Wells Fargo has done this with other subdivisions around the country that they have foreclosed on, though it is not their goal.

Wells Fargo is interested in money:  This should come as no surprise, but Wells Fargo's goal in being the new owner of the undeveloped areas of Preston Lake are to try to recoup as much as possible of the money that they have invested in the subdivision.  They won't, thus, try to unload the property for development into a mobile home park -- they will be marketing it and working to sell it for its highest and best use.  This does not mean that the development plan won't or can't change -- but they will be trying to recoup as much money as possible, and thus will be trying to sell it to a developer who has the a positive (and profitable) vision for it.

Those Pesky Lawsuits:  The developer of Preston Lake (Richard Hine) had filed a lawsuit against Wachovia (now Wells Fargo) --- and Wachovia had responded with a countersuit.  Per the attorney representing Wells Fargo, both of those lawsuits will go away once the sale closes, and the property is taken back by Wells Fargo.

A Community United:  If anything, the turmoil and uncertainty over the future of Preston Lake seems to have drawn its residents closer together as a community.  Most of the owners were in attendance at the sale, and then went as a group to Cally's afterward to have lunch.  There seems to be solidarity and general optimism (as much as is possible) amongst most (or all) of the owners.  They still seem to thoroughly enjoy their homes, and each other, which is a positive sign for the future of the community.

Have Questions?  If you have questions about Preston Lake or the foreclosure proceedings, I'm happy to try to answer them (540-578-0102, scott@HarrisonburgHousingToday.com), or you can contact Peter Barrett of Kutak Rock, LLP, who is the attorney representing Wells Fargo.  You can reach Mr. Barrett at 804-343-5237 or peter.barrett@kutackrock.com.

In Virginia, each newly constructed home must convey to the purchaser with a warranty from the builder, as outlined in the Virginia statute (55-70.1) entitled Implied warranties on new homes.  In brief, the builder must warrant the construction of the house for one year, and the foundation for five years.

One important thing to note, however, is that this required warranty on new homes does not apply if you first buy a lot and then hire a builder.  Here's the first section of the statute that speaks to this:


The issue, you'll note above, is that if you hire a contractor to build a house on your own lot, you are not in a contract for the sale of a new dwelling.  There will not be a conveyance of real estate -- title will not transfer -- you already own the real estate and are hiring someone to improve it.

From talking to a local real estate attorney, there are likely still construction quality expectations of builders of new homes when you have contracted with them to build on your own lot --- but those are are not neatly summed up in a statute. They are, instead, a part of the "common law" --- the aggregation of laws as defined by judges making rulings about such matters over the years.

Click here to learn more about the Virginia one year new home warranty.

There is a slowly growing area just north of Harrisonburg that you may not have heard of or visited, but there are a variety of factors that may make it a growth area over the next several to many years.



A strategic plan has been created for this North Valley Pike corridor, that suggests turning an existing section of Route 11 into a main street area, with most through traffic diverted to a new road.  For an overview with lots of helpful links, read the post on hburgnews.



A research and technology park has been established amidst this corridor on 365 acres, owned and operated by Rockingham County. 



SRI International has established a 25-acre campus in the above-referenced research and technology park, and opened the Center for Advanced Drug Research, which is a "state-of-the-art research facility for conducting systems biology research in the areas of biodefense and neglected diseases."



An attractive subdivision of single family homes is being developed in this corridor area (I am marketing this subdivision) with prices starting in the low $200,000's. 



A new elementary school was recently built on Smithland Road, not too far from this North Valley Pike corridor.  This has created new traffic flow patterns, bringing greater awareness to the north side of Harrisonburg.

While most development has taken place just southeast of Harrisonburg in the recent past, the area just north of Harrisonburg will be a key area to watch over the next 3 to 20 years.

If you are considering the purchase of a new home in Harrisonburg or Rockingham County, you may want to check out HarrisonburgNewHomes.com, where you'll find an overview of many of the new communities being built in our area. 



I represent the builders of each of these communities, and am assisting them with the marketing of the new single family homes, duplexes and townhomes.  For more information about any of these neighborhoods, feel free to contact me or one of the other Realtors also marketing these communities:

• Scott Rogers, 540-578-0102, scott@HarrisonburgHousingToday.com
• Suzanne Trow, 540-383-7173, suzanne@cbfunkhouser.com
• Carey Keyes, 540-476-1988, carey@cbfunkhouser.com
• Jennifer Chapman, 540-746-4774, jennifer@cbfunkhouser.com
  

 

Good Luck!  There are only two listings on the market right now labeled as Dutch Colonial homes.  Let's take a look at what IS for sale . . . .



As you can see, ranches, townhomes, contemporary homes and colonial homes are your best (or at least most prolific) option in Harrisonburg and Rockingham County.  Also of note, here's what sold in 2009 . . . .



We find the same leaders -- ranches, townhomes, contemporary homes and colonials.  Thus, we have a bit of a chicken/egg dilemma.  Are these types of homes being sold because that's what people want, or because that's what is available.

Here are the full numbers for those who are curious . . . .

  . 

Have you heard of American Builders Quarterly?  The publication provides a comprehensive look at the nation's entire construction industry by profiling leading companies that consistently perform in all aspects of the building trade.  Take a look at the covers of the last 15 issues (below) and you'll notice one company right here in Harrisonburg, Virginia that was recently highlighted by American Builders Quarterly: Scripture Communities.



This is rather big news, as this publication covers huge developments and developers all over the country --- but they took note (on the cover of the magazine, no less) of this local company that has been building communities in Harrisonburg and Rockingham County for several decades.



The article focused on Scripture Communities' emphasis on building lasting communities focused on market demands.  For years now, Jerry Scripture has been building unique, innovative communities to meet the specific needs and desires of home buyers in many different demographics. 

Communities currently being developed by Scripture Communities include:

• Heritage Estates: 55+ community with stunning French Country architecture, mountain and golf course views, and a community swimming pool.  Single family and paired homes, starting at $339k. www.HeritageEstates.us.
   
  
• The Cottages at Stone Spring:Energy-efficient "green homes" meticulously built to EarthCraft and/orEnergyStar standards.  Single family homes starting at $247k. www.TheCottagesAtStoneSpring.com.
   
  
• The Glen at Cross Keys: Spacious paired homes with high quality interior and exterior features and finishes, with a just released one-level floor plan.  Paired homes starting at $239k.  www.TheGlenAtCrossKeys.com. 
   
  
• Liberty Square: Two and three bedroom townhomes with City convenience, quality interior features many construction options, and several neighborhood amenities.  Townhomes starting at $149k.  www.LibertySquare.biz.
   
  
• Founders Way: One-level upscale condominiums with amenities such as a swimming pool, fitness center and jogging trail.  Construction has begun!  Condos starting at $149k.  www.FoundersWay.com.
  

If you have questions about any of these communities, please let me know (540-578-0102, scott@HarrisonburgHousingToday.com), as I represent Scripture Communities and can either answer your question, or identify someone who can.

ALSO --- STOP THE PRESS!
Don't forget about the Scripture Community Move Up Program, where Scripture Communities will potentially buy your house if you love one of their new communities and want to move up into a new home. 

If you're building a home, what should you use as a driveway material?  There are a lot of options!

• Pavers, Brick or Stone
• Concrete, Stamped Concrete, or Exposed Aggregate
  
• Asphalt
• Gravel
• Dirt

Each has their own advantages and disadvantages, related to cost, appearance, durability, etc. 

Let's take a look at the most common types of driveways in Harrisonburg and Rockingham County.  The data source for this analysis is the Harrisonburg/Rockingham Association of Realtors MLS, so it's an inexact analysis, but can still provide some helpful insights. 



The chart above shows that the most common driveway material for single family homes in Harrisonburg and Rockingham County is gravel!  Beyond gravel drives, which are likely found mostly in the County, the most frequently occurring driveway is an asphalt driveway.  Let's take a closer look at driveways of single family homes in the City of Harrisonburg, to exclude the more "rustic" driveways found on homes further out in the County . . .



In the City of Harrisonburg, a full 1 in 5 driveways is still gravel, though asphalt driveways now lead the pack, with a full 10% greater market share than concrete driveways.



The graph above analyzes "expensive" homes --- those sold above $350k in the last year in Harrisonburg and Rockingham County.  Here we find an even more overwhelming share of asphalt driveways, though we also see an increase in the percentage of exposed aggregate driveways.



Perhaps most interesting is that when examining homes sold since Jan 1 2000, we find that most have had concrete driveways.  Is this perhaps the sign of a growing trend in our area, or the nation as a whole?


Notes:  In the last year, 570 single family homes sold in Harrisonburg and Rockingham County (per the HRAR MLS), and the analysis above is based on the 534 sales where driveway data was present and usable.

Almost a year ago I mentioned that a new road connecting Erickson Avenue to Stone Spring Road was moving forward.  Construction is now moving forward, with lots of progress starting on the Erickson Avenue end of the connector.

Below is a map showing where that will be situated (click on the map for a larger version) and this is a web site with more details.

City Portion of Erickson Avenue / Stone Spring Road Connector:



The road shown above lies in the City, but the Connector will continue into the County, all the way to Route 33 East near Boyers Road. 

The map below shows an overlay of the approved map from VDOT over top of both an aerial and road view from Google Maps.  Click on either for a larger view.

Rockingham County Southeast Connector (1 of 2 portions)





As far as I can tell, the County portion will cut through the new campus of Rockingham Memorial Hospital, and then cross through Boyers Road before connecting with Route 33.  From what I have heard, Boyers Road will become a cul-de-sac before reaching Route 33.

If you are making any additions, improvements or repairs to your home you must pull a building permit, and if it involves electrical or plumbing work you'll also need to pull an electric permit and/or plumbing permit.

"But Why?" you might ask....

In the here and now, you need to pull the appropriate permits because that is what Harrisonburg and Rockingham County require of you.  Also in the here and now, pulling the permits will thus require inspections, which will go a long way towards assuring that the changes made to your house are safe, per their compliance with the Building Code.

In the future --- as in the time when you want to then sell your home --- it is arguably very important to have pulled building permits and to have passed the inspections.

In selling your home, you are required to disclose any material adverse facts about your home.  In my view, the fact that the basement was finished (or other improvements were made) without permits and inspections is a material adverse fact about the house.  It's not necessarily that the house is unsafe, but the fact that parts of the home were never inspected by the locality create that possibility.

Pull the permits.  Get the inspections!

I suppose plumbers may have been installing thermal expansion tanks (pictured above) for years, but I first starting seeing them a few years ago, and wondered what they were and why they were being installed.

A thermal expansion tank's purpose is to reduce thermal expansion that occurs when the water is heated and pressurized.  Thus, if your hot water heater does not have an expansion tank, and is leaking or dripping from the pressure-relief valve, it would be wise to install a tank.

The other aspect of these expansion tanks that mystified me for quite some time is that I assumed that they would be installed on the hot water line coming out of the hot water heater, but most that I observed were installed on the cold water line. 

As it turns out, the expansion tank can be installed either on the cold water line between the main valve and the water heater, or on the hot-water line within 3 to 5 feet of the water heater.

OK --- so the typical smoke alarm isn't all that visually obtrusive --- but it is when compared to Kidde's Silhouette smoke alarm! 

This low-profile smoke alarm protrudes less than half an inch from the ceiling, blending in much more nicely than a traditionally shaped smoke alarm.  Furthermore, it uses a rechargeable battery that will last the life of the alarm!  No more changing the batteries when the alarm starts beeping!

Are you considering buying at Preston Lake?  Some of my clients are exploring the possibility of building a single family home at Preston Lake, and it's been an interesting process . . .



Access to the developer
We have been pleasantly surprised to have the opportunity to work directly with the developer, Richard Hine.  Rich is very invested in the Preston Lake project, is very knowledgeable about the building process, and has been immensely helpful as my clients have explored the possibility of building at Preston Lake.

A flexible design process
While Preston Lake offers a variety of standard floor plans (for rowhouses and single family homes), they are also willing to make almost any modifications you might desire.  We have now been through several different renditions of the floor plans for the "Cape Cod" style home, each time bringing the design a bit closer to what my clients' desires.

Organized communication
The building team at Preston Lake uses an online project management system to organize the design/build process, and to streamline communication.  Even only in these early stages of the process, the use of this tool has been extremely helpful.

Final Pricing, Building Process, Final Product
Still yet to discover --- will the pricing work for my clients, will the building process be as pleasant as the design process, and will the finished home be exactly what my clients envisioned.

Overall, the building process at Preston Lake (or the complemplation thereof) has been a relatively enjoyable and efficient process.  If you are considering buying at Preston Lake, and if you have any questions, please call (540-578-0102) or e-mail (scott@cbfunkhouser.com) me.  Otherwise, stay tuned, and I'll keep you informed on the continuation of this process.

Roughly a month ago, the International Code Council approved hundreds of changes to be included in the 2009 version of the International Codes.  Several of these changes mean we will be seeing more fire sprinklers in new construction homes:

• Fire sprinklers are required in all new one- and two-family residences beginning Jan. 1, 2011.
• Fire sprinklers are required in all new townhomes.

Several other interesting code changes include:

• Carbon monoxide detectors are required in homes with attached garages or fuel-fired equipment such as gas furnaces, gas stoves and gas water heaters.
  
• A requirement to install programmable thermostats in new homes and buildings with forced air furnaces.
  
• High-efficiency light bulbs required in at least 50% of permanent lighting fixtures in new homes.

Here is a slightly longer list of significant changes, and an overview of the 2008 annual conference.

Are you trying to avoid the potential danger of a space heater?  Are you trying to heat a room or garage more efficiently than with a space heater?  Have you considered a ceiling fan?

The fan pictured above, the Reiker Room Condition, may be what you are looking for.  A heater is housed just above the fan blades, and the heat being generated is evenly distributed throughout a room. 

These sophisticated fans will cost between $270 and $400 depending on options and finishes, and can be ordered through the Reiker web site, or found at some Home Depot stores.

The City of Harrisonburg is accepting bids on the two parcels of R-2 land labeled below.  The first parcel (labeled "1" below) contains 3.119 acres.  The second parcel (labeled "2" below) contains 5.018 acres.



This land, zoned R-2, provides for a great residential development opportunity --- a convenient location close to Route 11, Route 42, Port Republic Road, Keister Elementary, and more. 

Bids will be accepted until 9:00AM on April 8, 2008, and the bids will be opened at the City Council meeting at 7:00PM on April 8, 2008.


View Larger Map

I am delighted to be a part of marketing and selling the Urban Exchange project --- an exciting new construction project in downtown Harrisonburg featuring retail space on the first floor and almost 200 apartments and condos. 

The photo below shows the excavation progress (these aren't just really deep footers, there will be two levels of underground covered parking).  See more photos of the progress by clicking here.

As you consider buying a newly constructed home, it is important to be aware of what is often referred to as a one-year builder warranty.

Technically, what we are referring to are "Implied warranties on new homes" per Virginia statute 55-70.1.


What is covered by the warranty?

The builder warrants that the "dwelling with all its fixtures is, to the best of the actual knowledge of the vendor or his agents, sufficiently (i) free from structural defects, so as to pass without objection in the trade, and (ii) constructed in a workmanlike manner, so as to pass without objection in the trade." Essentially, no structural defects, and workmanlike construction.


When does the one year start?

The earlier of when the title is transferred, or when the buyer takes possession of the property.


I bought a house three months ago and have discovered structural defects. The builder is telling me a warranty doesn't exist, because "as is" was written into the contract. Is this possible?

It is possible to modify or exclude the Virginia statute based implied warranty. However --- it is likely that the builder did not follow the statute when selling the property to you as is.

To sell a new property "as is" and exclude the implied home warranty, the fact that the house is being sold "as is" must be written on the face of the contract, in capital letters, in a font size at least two points larger than the other type in the contract. This doesn't happen too often.


I have a structural issue, what do I do?

The statute specifies that you have a cause of action against the builder, but that you must first notify the builder of the defect and allow them a reasonable period of time (no longer than six months) to cure the defect.


What about the foundation?

The foundation is warrantied for five years (instead of just one) --- though if a foundation issue exists, it must be reported to the builder within two years of when it is discovered.


The Virginia statute keeps referring to a "structural defect" --- what is that?

Per the code, "a defect or defects that reduce the stability or safety of the structure below accepted standards or that restrict the normal use thereof." Yes, that is about as vague as you can get.


My builder is asking me to sign a warranty document at closing --- why? And should I sign it?

First, take time to read the document.  In most cases, such a document includes verbiage that limits the (vague) rights you would have had under the broad Virginia statute.  Builders ask buyers to sign these documents to narrow the scope of buyer's possible warranty requests --- and this desire often comes from past buyers who have been unreasonable in asking the builder to address cosmetic (or other non-structural) issues within the first year. 

If the document only includes language that restricts or eliminates your rights under the broad Virginia statute, kindly refuse to sign the document.  Unless all parties agreed in the sales contract that a warranty document would be signed at closing, the builder can not require you to sign the document --- it is imposing a new contract term on the buyer, when that was not included in the original negotiations. 

One caveat --- sometimes the document serves both the builder and the buyer --- it can do so by specifically stating items that the builder will indeed repair that might otherwise be in a gray area given the vague nature of the Virginia statute.

Have you driven by Market Street, Mason Street or Water Street lately?  Here's what you have been missing --- lots of demolition on the Urban Exchange site . . .



Urban Exchange will be comprised of retail space, and four floors of condos and apartments.



To see more photos, visit: http://www.ueharrisonburg.com/photos.