By design, cities grow from inside out. Find the best lots.
As the demand for housing in preferred locations increases, the supply of developed lots for future homes is drying up. Specifically, once a town is established, residents want to live as close to it as possible. In every U.S. city, the oldest homes are typically found closest to the downtown area. When observed from the air, one can see the circular growth of housing as it moves further from the city center to what we now refer to as the suburbs. Developers know that the farther from town you go, the cheaper the land will be. However, there is a limit; eventually, the location becomes less desirable to families due to traffic, lack of services, shopping, and other amenities. Nonetheless, developers continue to buy cheaper land and expand outwardly. Over time, cities and counties add regulations to new developments, which drives up the cost of turning raw land into residential homesites. Eventually, affordable housing is phased out.
New home-sites are now often expensive.
Sometimes, it makes sense to buy an existing home in a desirable location and demolish it so that the lot can be used again. This trend is occurring across the country and has led sellers to understand that the land under their home is the true value of their property. In our firm, 60% of the new homes we build are now on home-sites that were repurposed by tearing down an existing home. This phenomenon isn’t limited to inner-city areas; we build many waterfront homes, and a higher percentage of those begin with a tear-down. Simply put, the original owners chose these locations first and wanted the same views and lifestyle that families today desire. Articles have been written about how the best lots are hiding under existing homes. When a new buyer is interested only in the land beneath the home, it often makes the transaction easier for the seller.