As the second phase of a Scotts Valley housing development — five new dwellings — nears completion, developer Chris Perri is excited about how things are shaping up.
“A lot of people thought we were crazy at first,” Perri said, because of the decision to start building The Meadow at Falcon Ridge in the midst of a recession. “(But contractors) were happy there was money being spent.”
Construction on the initial phase of the planned 16-home development began in mid-2009 and was completed in 2010. Those first four homes were sold before they needed to be listed, Perri said.
“It was great to keep our guys busy,” said Perri, the principal of Apple Homes Development Inc. “We use the same guys for many years on our developments.”
Work on the five-home second phase began last year and will be finished in the next few months. Two more phases will be built by 2013, Perri said.
American Dream realtor Jack Western agreed that the middle of the recession is a tough time to build and sell homes.
“I’m surprised they’re going forward with this,” Western said. “They’re anticipating the market is going to improve.”
However, Ronnie Trubek, a Century 21 Showcase realtor in Scotts Valley, said that as the economy and the housing market in Santa Clara and San Mateo counties heats up, the development is in a good place.
“I think the timing to get (this development) on the market is perfect,” Trubek said, noting the 20-minute drive from San Jose from the north end of Scotts Valley.
“The public responds really well to new construction in planned communities, and I think there is always a market for those types of homes at that price,” Trubek said.
The four-bedroom, 3½-bath homes stand along Green Hills Road on a 40-acre parcel that reaches into the hills and runs parallel to Highway 17. Thirty-three of the privately-owned acres are dedicated open space, with trails and a picnic area in the wooded hills above the development. Wetlands behind the development help recharge the underlying aquifer.
Each house has a different façade but an identical 3,700-square-foot floor plan. Listed at $975,000, they have specialized cabinetry, solar panels on the roof and tankless water heaters.
“Our business philosophy is to provide the best house for the best price,” Perri said.
According to a housing snapshot by Perri’s realtor, Mark Szychowski of Delaveaga Properties, homes in Scotts Valley, including foreclosures, have sold for an average of $316.14 per square foot over the past year. The homes in the development are priced at less than $264 per square foot.
“We bought the property in foreclosure,” Perri said. “We knew we could offer the houses at a price and quality that can’t be beat.”
Perri explained that if a house is priced reasonably for what the buyer gets, there will be a market for it, even at a price tag close to $1 million.
That doesn’t mean the real estate market has recovered, though.
“I’d love to see the market turn,” Western said. “I’ve been talking with lenders, title people and agents; we’ve been under this cloud for too long.”
Western said he is not optimistic about the prospects for homes selling for $1 million or more, because it’s usually a case of a family or homeowner trading up.
He explained that borrowers can get a jumbo loan for about $750,000 and must come up with $200,000 to $250,000 in cash for a million-dollar home. However, he’s found that the equity is not there when a family sells a house to buy another.
Trubek recently saw a 3,000-square-foot house in Glenwood Estates, across from Scotts Valley High School, sell for a price in the “low $900,000s”
Homes in the Monte Fiore development, which run between 3,000 and 3,300 square feet, are on the market for $850,000 to $950,000.
The Meadow at Falcon Ridge is inside Scotts Valley city limits — the same as Perri’s previous two developments, on Sherman Court and on Bean Creek Road.
An open house is planned from 1 to 4 p.m. Sunday, May 8, to showcase a completed home for prospective buyers.
