Many first-time buyers already had their sights set on the suburbs prior to the coronavirus outbreak. But Cheryl Bonk, vice president of sales and marketing at M/I Homes, said the combination of coronavirus, lifestyle changes of millennials and low interest rates has many first-time buyers “moving up their timelines.”
Her company pivoted this spring to meet the demands of this outflow of clients, working to create the next generation of starter homes in the suburbs. M/I just added two new models to its “smart series” line of homes — mainly adding more square footage in response to client demand — which have been tremendously successful in Plano and Joliet, Bonk said.
These homes start at around $190,000, and M/I provides services throughout the homebuying process, such as its design service, which enables buyers to better envision the updated home vignettes and design ideas M/I offers.
Bonk said sales have been up on both ends of the spectrum in terms of price — while many first-time buyers are looking for more affordable options, those who can afford a little more square footage are increasingly interested in getting out of the city.
M/I isn’t the only Chicagoland developer looking to meet the needs of first-time homebuyers eyeing the suburbs. Lexington Homes Principal Jeff Benach has seen similar success with the company’s Lexington Trace townhome community in Warrenville. “We’ve been pleasantly surprised how things have held out since this hit,” he said of the activity since the pandemic took hold.
“They want to be able to go outside without being shoulder-to-shoulder with other people,” he said, adding that many currently feel “cooped up and want a backyard.”
Lexington Trace offers two- and three-story townhomes starting at $299,000; Benach noted that their lower price point has always made them popular, but low interest rates have made them even more desirable because they have enabled more people to get into the market as first-time buyers.
What keeps Benach up at night? Well, not much these days, but the developer says subsurface uncertainty scares a lot of developers away from projects. “National [firms] are looking for clean ground to go through and be done,” he said, noting that unexpected environmental cleanup costs can slow or kill a project.