Amid affordability squeeze, builder markets $300,000 houses

8:04 a.m. Thursday, July 13, 2017 Business
Jeff Ostrowski
The builder of Arbor Parc in Riviera Beach is marketing 250 new single-family homes, many of them priced at less than $300,000.

A builder promises to offer that rarest of products in Palm Beach County’s real estate market — new single-family homes priced at less than $300,000.

The builder, 13th Floor Homes of Tamarac, has begun marketing 250 houses at Arbor Parc, a development just west of Interstate 95 and just north of Blue Heron Boulevard in Riviera Beach.

Prices range from $278,990 to $336,990 for floor plans of 1,558 square feet to 2,086 square feet.

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Once a staple of Palm Beach County’s property market, newly built entry-level houses essentially disappeared after the housing crash of 2008 and 2009.

With large tracts of land scarce, builders have turned their focus to more expensive new homes. The median price of a new house sold in Palm Beach County is more than $600,000, said David Cobb, regional director of Metrostudy, a housing research firm. He predicted strong demand for Arbor Parc.

“I wouldn’t be surprised if they do pretty well at that price point,” Cobb said. “The location’s good, and the pricing’s good.”

13th Floor Homes has seen brisk sales of similarly priced houses at two of its communities in Tamarac, said Mike Nunziata, division president of 13th Floor Homes.

Because builders have largely ignored entry-level homes, Nunziata said, “There’s an unbelievable amount of unmet demand in the market.”

Buyers at Arbor Parc will find a scaled-down version of the American dream. While all of the models include garages, many have room for just one car. And the yards are too small to accommodate swimming pools.

But 13th Floor Homes is focusing on what buyers will get. All of the homes include three or four bedrooms, and the prices include granite counters, wood cabinets, impact-resistant windows and other features that often cost extra.

The builder is targeting first-time buyers by pointing out that owning a $300,000 house might cost less than renting. Borrowing $240,000 for 30 years at 4 percent interest translates to a mortgage payment of $1,146 a month. The median rent for a two-bedroom apartment in West Palm Beach is $1,330.

Arbor Parc is on the site of a townhouse project formerly known as Mediterranea. That project fizzled because of unfortunate timing — units there hit the market just before the real estate bubble burst.

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In addition to the 250 houses at Arbor Parc, 13th Floor Homes also plans to build 250 townhouses.

Palm Beach County’s new-home market isn’t completely devoid of sub-$300,000 houses. Texas-based D.R. Horton is marketing entry-level houses at small project such as the 24-home Haverhill Pointe in Haverhill. Prices there start at $283,990 for a 1,504-square-foot house.

More typically, builders have focused on higher-end homes. At Alton in Palm Beach Gardens, for instance, Kolter Homes sells houses priced at $562,900 to $1.15 million.

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After a building slowdown that lasted nearly a decade, Palm Beach County’s housing engine is ramping up again. In the largest new project, Minto Communities plans 4,500 homes at Westlake, a newly incorporated city on the site of the former Callery Judge citrus grove.

Minto has yet to disclose price ranges for its homes.