K Hovnanian Homes is reporting upbeat sales figures and projections for new home sales. Ara Hovnanian recently told Wall Street analysts that the company has seen the “trend reverse” after 15 consecutive quarters of declining sales and cancelled contracts. In July, Hovnanian saw a 62% increase in contracts per community. The number of cancellations also fell from a year earlier. The company has begun cutting back on buyer incentives and increasing prices at some of its developments.
Hovnanian has two communities of new homes for sale in San Diego, CA, Bella Lago in Chula Vista and Lake Rancho Viejo in Fallbrook.
Bella Lago, Chula Vista, CA (South San Diego County)
Residence 1 Homes at Bella Lago in Chula Vista, CA
Bella Lago is an upscale community planned to include 155 detached homes ranging from 3,867 sq. ft. to 4,992 square feet. The average lot size at Bella Lago is 24,000 square feet (half an acre). The homes incorporate classic European cottages, Monterey, Spanish Colonial, and Italian styles.
Currently selling at Bella Lago, the 3,867 square foot Residence 1 is a single-story house with 3 bedrooms, 3.5 bathrooms, and a 3-car garage. Each home includes a Loggia Courtyard, making the most of frequent outdoor living opportunities in San Diego, CA. Plans allow for an optional 4th bedroom in lieu of den, and optional 5th bedroom and 4th bathroom in lieu of bonus room. Easy modification provides lots of flexibility for expansion.
Bella Lago’s “Residence 3” design is a two story detached house with 5 bedrooms, 4.5 bathrooms, and approximately 4,770 square feet of living area, with a 3-car garage. Residence 4 is a similarly sized 4,728 square foot design with 5 bedrooms, 5.5 bathrooms, and a 2-car Garage. The largest homes at Bella Lago are Residence 4G is a two-story design with 6 bedrooms, 6.5 bathrooms, and 4,992 square feet of living area. A bonus room can be converted to a 7th bedroom or a home theater.
Upscale Kitchens In Chula Vista New Homes at Bella Lago
Chula Vista is an up and coming group of neighborhoods. Five Chula Vista zip codes (91910 91911, 91913, 91914, and 91915) span most of South Bay San Diego County. The City of Chula Vista covers 50 square miles and a population of roughly 230,000. Amenities include outdoor recreation at Eastlake and Otay Lakes, fine dining and shopping including the new Otay Lakes Town Center. Proximity to San Diego will continue to make Chula Vista a popular San Diego suburb. The new 125 Toll Road has shortened the job commute times significantly for many area employees.
Lake Rancho Viejo in Fallbrook, CA (North San Diego County)
Residence 3 Homes at Lake Rancho Viejo, Fallbrook, CA (North County San Diego)
Located near the charming town of Fallbrook, CA (which has essentially become a distant suburb of San Diego), Lake Rancho Viejo is a community of 284 homes ranging from 2,845 square feet to 3,795 square feet. Prices range from $365,000 TO $400,000, with a variety of buyer incentives. The homes for sale at Lake Rancho Viejo are built to order.
Only about 20 minutes to Carlsbad and the beaches, Lake Rancho Viejo enjoys one of the many San Diego microclimates with cool ocean breezes. The homes are designed in a mix of Traditional, Spanish, and Cottage styles. Select from
- Residence 1, 3 bedrooms 2.5 bathrooms, 1,854 square feet
- Residence 2: 3 bedrooms, 2.5 bathrooms, 1970 square feet
- Residence 3: 3 bedrooms, 2.5 bathrooms, 2,414 square feet
- Residence 4: 3 bedrooms, 3 bathrooms, 2,845 square feet.
The different floor plans “Sell Out” occasionally, but new releases are coming. All four plans, Residence 1 through 4, will have new releases on Saturday, September 19, 2009. But the new releases won’t last forever. As of the date of this article, Lake Rancho Viejo has sold 217 of the 284 homes planned for the community. 191 have closed escrow, and 26 are under contract.
Hovnanian is optimistic about the future. The company has been buying lots at reduced prices from banks after foreclosure. The company reports that it has been able to buy “finished lots at a discount to the development cost with the land essentially free.” Similar moves by other new home developers suggest that in the future builders may have more flexibility to reduce new homes prices, maintain better sales margins, and remain competitive with lower-priced resale homes.
It appears as though Hovnanian has a sound business plan buying foreclosed lots at reduced rates and building in a depressed market. This helps reduce cost and makes these new homes competitively priced compared to available resales.
The housing market will eventually rebound completely. It always does just the California housing market rebounded in the ‘90s. That said it looks like Hovnanian has a business plan to make it until better days are seen in California for real estate.