Chip Hurst West Georgia Real Estate

Villa Rica’s year-end building permit numbers reflect the shift in the housing market from new homes to foreclosures, but city officials are seeing signs there might be at least a slight rebound in 2010.

The city finished 2009 with the worst annual building permit totals in at least 10 years, with only 25 new permits issued last year — 14 commercial permits and 11 residential building permits. There were an additional 21 permits issued in the “other” category for additions, renovations and permit renewals.

Villa Rica’s busiest new construction months in 2009 were in March and November, when there were five new permits issued in each of those months.

Villa Rica’s all-time high for new building permits was set in 2006 with 662 permits issued, 577 of which were new residential construction. Before the latest figures had been released, the city’s lowest total in the last 10 years was in 2008 with 69 new permits issued, 38 of which were residential.

Knowing that 2009 would be a down year due to the economy, city officials had projected they would receive 45 new building permits last year based on an informal survey of the expectations of local builders. But as foreclosures flooded the market new residential construction came to a grinding halt. There were no new residential permits issued on the Douglas County side of the city until two were issued in December.

“I’m disappointed we had so few, but at least we’re seeing signs of improvement,” City Manager Larry Wood said.

Community Development Manager Taurus Freeman said that many developers have stopped by City Hall recently and expressed interest in building homes in Villa Rica in the coming year. Among those is the Liberty Point subdivision on Conners Road where construction has already begun on two homes in the proposed 700-home subdivision that is slated to be built in phases over 10 years.

Freeman added that there is another development in the process of being sold and the prospective buyers have said they plan to build new homes there soon after the property is acquired.

“Our forecast for next year, we’re very optimistic about it because we do have some people willing to continue to build,” he said. “We may not see the kind of growth we had in past years, but I do think we’ll see an increase in 2010 as opposed to 2009 and 2008.”

Another sign that residential construction may begin to pick up comes in the real estate market, where Freeman said he has been told by several Realtors in Villa Rica and other metro-Atlanta communities that the foreclosed homes on the market are selling well and the inventory has dropped. At the same time, he said the price point for new construction has dropped and potential buyers are seeing that they can get a brand new home for about the same price as foreclosed properties already on the market.

“I don’t think the market will ever rebound to what we had before, but once it picks back up we ought to easily get at least 100 new homes per year,” Freeman said.

Some real estate experts have predicted an increase in the number of commercial properties that will be foreclosed on this spring. But city officials aren’t too concerned because even as the economy has lagged city officials point to the fact that when a business in Villa Rica has gone vacant in the last year it typically hasn’t taken long for a new entrepreneur to set up shop.

The city is currently in the process of gathering its business license renewals for the coming year and once the process is complete officials said they will be better able to gauge how many businesses the city will have operating this year compared to last year. The city saw a tremendous increase in business licenses in 2009 versus 2008 even though city officials expressed skepticism then that the economy would be able to support that trend.

“We’re fortunate compared to other cities not to have that decrease,” Freeman said. “We have a lot of strong businesses here and our citizens seem to support those businesses.”