Homes are selling so quickly at the Lakes at Rancho El Dorado that prices are now in the high $200,000s, up from the mid $200,000s when Scottsdale-based Meritage Homes Corp. (NYSE: MTH) announced the opening a month ago.
“Price increasing is due to demand, but more so rapidly increasing building costs,” said Fred Hermann, Phoenix division president of Meritage Homes.
Jim Belfiore, founder of Belfiore Real Estate Consulting, said home prices continue to rise at an almost inconceivable pace across metro Phoenix, with builders raising projected startup prices multiple times in many cases before offering homes for sales.
“Without more supply becoming available, my personal forecast of 12% to 15% appreciation this year — for the second consecutive year — may be eclipsed by an even larger rise,” he said.
Phoenix topped the nation in home price growth in December, reporting a 14.4% year-over-year gain at a time when the national increase was 10.4%, according to the S&P CoreLogic Case-Shiller Indices released late last month.
The nation’s seventh largest homebuilder sold more than 20 homes in January and February at the Lakes, he said.
Plans call for building 179 homes ranging between 1,218 and 2,280 square feet. The new community is within Scottsdale-based Harvard Investments Inc.’s $150 million master-planned community called The Lakes at Rancho El Dorado in the city of Maricopa, a 30-mile drive from Phoenix Sky Harbor International Airport.
“This community is at a very attractive price point with all of Meritage’s energy and money saving features,” he said.
Near the Arizona State Route 347, this location provides residents easy access to major employment centers, premier restaurants and entertainment, he said.
Scottsdale-based El Dorado Holdings Inc. was instrumental in building Maricopa into the city it is today, and now is in the midst of a $1 billion, 1,500-acre residential project there called Eagle Shadow.
“Meritage has other communities in Maricopa and is pursuing several other opportunities in this great area,” Hermann said.