A common misconception among homebuyers is the idea that the best home values in the current marketplace are foreclosures.

While Fountain Hills developer Dan Kauffman agrees there are some good deals on short sale and foreclosure homes, for most consumers, buying a new home is a better value.

Kauffman shared his insights on the market and explained the advantages of buying new construction over a property in foreclosure.

Kauffman has retooled his business approach by reducing  prices on new construction in his two gated Apache Junction communities, Jacob’s Ranch and White Dove Ranch.

The current market is ripe for homes priced between $100,000 and $150,000, said Kauffman, a Fountain Hills developer for 15 years. His office is located in Executive Suites, commercial property he owns at 16810 Avenue of the Fountains.  

Jacob’s Ranch, a family-friendly community of 350 building lots in the Apache Junction-Mesa area, has a three bedroom, two-bath model starting at $99,900. Amenities consist of a community swimming pool, clubhouse with fitness center, basketball court, soccer fields and tot lots. Two hundred homes remain to be built.

Or, a buyer can purchase a single-level home in his White Dove Ranch, an age-restricted community for 55 or older, for as low as $139,900. White Dove Ranch, also in Apache Junction, consists of 151 single-story homes; 100 lots remain in the development. Both Jacob’s Ranch and White Dove Ranch are near Route 60 and 202 for convenient accessibility.

White Dove features include a heated swimming pool, putting green, clubhouse with dance floor/auditorium, library, fitness room and tennis court.

Before the collapse of the real estate market, Kauffman sold 45 homes last year. He closed down operations when he found it impossible to compete with foreclosures.

“I have gone out as a developer and re-bid all the houses to sub-contractors,” said Kauffman. “Now that supply and construction materials have come down, the sub-contractors are hungry. They actually want work so they bid low.

“We’ve priced them at the same price or around the same price that foreclosure homes are selling for in the communities.”

A 2,045-square-foot four bedroom and 2½-bath house sold last year in Jacob’s Ranch for $270,000. The price has dropped to $123,900.

Most buyers may not realize there are a variety of risks associated with buying a foreclosure, said Kauffman. The properties are sold “as is,” meaning no warranties come with the sale, compared to new home guarantees.

Foreclosure properties often attract multiple offers with banks preferring to accept cash rather than wait for a buyer to obtain financing.

After having their hopes raised and spending time to secure a mortgage, the prospective homebuyer can be shoved out of the picture.  

With attractive interest rates and incentives for first-time homebuyers, Kauffman pitches the advantages of buying new construction over foreclosures.

If buyers still need more incentive, Kauffman Homes uses green building elements and is a certified SRP PowerWise Home Builder.

The designation requires a contractor, such as Kauffman Homes, to comply with specific guidelines regarding energy, water and materials to reduce impacts on human health and the environment.

“In the big picture, buildings have a significant impact on our environment. They use one quarter of the world’s wood harvest and are responsible for 54 percent of U.S. energy consumption and 35 percent of U.S. Carbon dioxide emission through operation and construction,” said Kauffman.

Kauffman said a SRP PowerWise Home is tested and inspected for air and ductwork leakage, properly installed insulation, energy efficient heating and cooling systems and low E-windows and improved framing to keep out the sun’s heat and harmful ultraviolet rays.

“I can build a whole house with all green elements in it but it would be too costly,” said Kauffman.

Above and beyond the energy-efficient homes he constructs, a buyer can choose upgraded options from insulation to water saving to solar panels to produce electricity.

He has teamed with Bank of America Home Mortgage Loan specialists Linda Melucci and Bernie Corbin as his preferred lenders. Their office address is 16810 Avenue of the Fountains, suite 104. For assistance with securing a Bank of America mortgage, consult Corbin at (480) 570-9061 or Melucci at (480) 620-1302. The office telephone number is (480) 776-0265.

Prospective homebuyers can learn more about Jacob’s Ranch and White Dove Ranch by visiting www.kauffmanhomes.com. The Web site includes pricing and availability of floor plans.

To call a sales agent at Jacob’s Ranch, the telephone number is (480) 888-7826. Inquiries about White Dove Ranch should be directed to (480) 288-1794.