U.S. Housing Market May Bottom in 2009, Zandi Says
“Notwithstanding the intensifying economic gloom, the bottom of the housing downturn is within sight,” Mark Zandi, chief economist for Moody’s Economy.com, said in a Feb. 9 statement. “Presuming we see strong action by policymakers to help support the economy and the housing market, prices will begin to recovery by the end of this year.” The Obama Administration and Congress are trying to stem the housing slide at the root of the U.S. recession. President Barack Obama is trying to get a $780 billion economic stimulus bill passed that may help ease lending and bolster home buying. (www.bloomberg.com)
Bloomberg.com (2/9/09); Brian Louis
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South Florida Housing Prices Becoming Affordable Again
For many South Floridians, there is an upside to the otherwise brutal downturn in real estate, with its flurry of foreclosures, personal bankruptcies and spreading economic pain. Housing is suddenly affordable to those with average income — without risky teaser rates or subprime mortgages or cooking the numbers to qualify. Foreclosures and a sluggish market have pushed prices down by as much as 43% since they peaked in 2006 and 2007. For the first time in a long while, thousands of homes are listed for less than $150,000 — even less than $100,000 — putting them snugly within the affordability range of police officers, teachers and others long priced out of the South Florida market. At the peak of the market, affordable housing was so scarce that companies had difficulty recruiting workers from outside the region. While the pickings are more plentiful now, borrowing hurdles are daunting, often including demands for 20% downpayments and stellar credit scores. Buyers are also being held back by fears that housing prices will sink even more and by concerns that they could lose their jobs in the deepening recession. For home buyers with more modest savings and means, FHA loans are filling in the financing gap with downpayments of only 3.5% of the purchase price and a little more lenient credit standards. (www.miamiherald.com)
Miami Herald (2/7/09); Monica Hatcher
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Beazer’s Quarterly Loss Narrows; Shares Rally
Shares of Beazer Homes USA Inc. opened 26% higher on Monday morning after the home builder reported a narrower first-quarter loss on smaller write-downs. The Atlanta-based company posted a net loss of $80.3 million, or $2.08 a share, for the three months ended Dec. 31, compared with a loss of $138.2 million, or $3.59 a share, during the same period during fiscal 2008. “The housing industry continues to face the most difficult business conditions in many decades,” said Ian McCarthy, Beazer’s chief executive. Orders for new homes fell 57% from the year-earlier quarter to 545, while the cancellation rate held relatively steady at roughly 46% as nervous buyers continued to walk away. Beazer operates in some of the nation’s hardest-hit residential markets, such as California, Arizona and Florida. The builder said it didn’t offer additional sales incentives or price reductions in the latest quarter because it didn’t think these would meaningfully boost orders, citing “the significant turmoil in the general economy and the financial markets in particular and a general hesitancy by consumers to make home purchase decisions.” (www.marketwatch.com)
MarketWatch (2/9/09); John Spence
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Toll Bros. Sells Lifestyle With Home
Toll Brothers’ first subdivision in 1967 touted its houses’ one-car, attached garages, master bathrooms and crawl spaces. This year, as it completed its 700th development, its most popular product was the 4,800-square-foot Henley, which includes three staircases, a security system and an island cooktop. What Toll hasn’t changed over the years, says senior vice president Andrew Stern, is its sales strategy. “We sell a community lifestyle,” says Stern. “We want people to drive home and say, “This is my community,’ not “This is my front door.’” The benefit for buyers, he says, is getting “more than just a home. Playing golf with a neighbor, sitting by the pool with friends, taking exercise classes with your buddies, playing cards and dining with those in your immediate vicinity all provide a lifestyle.” Billing itself as “America’s Luxury Home Builder,” Toll’s niche is the high-end, semi-custom home. Its buyers expect luxuries such as granite countertops and extensive woodwork, says Stern, but don’t have the time or desire to build custom homes. Although the depressed economy is causing Toll buyers to cut their budgets, Stern says, they are not willing to compromise on the room they consider the most important: the kitchen. “Instead, many are giving up finished basements or landscaping because they can add those later,” he says. His buyers’ greatest obstacle today, says Stern, is their inability to sell their houses before they can buy new ones. To help them, Toll provides free staging services for their old houses and offers extended interest-rate locks on their new homes. (www.chicagotribune.com)
Chicago Tribune (2/6/09); Leslie Mann
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Logging Out; New Styles of Fireplaces Eliminate Need for Chimneys
Clean, increasingly stylish, easy to use and flexible to place, direct-vent, ventless and electrical fireplaces have seen an increase in popularity. “The product is becoming very, very popular because you can put them anywhere in any room in any size you want,” said Jim Hilz, executive director of the Building Industry Association of Central Ohio. “It’s really amazing where that product is going and has gone.” “You don’t need to run flues or chimneys,” said Neil Rogers of Bob Webb Builders. “Aesthetically, it allows more flexibility to place the fireplace. Hilz said he saw many displays of ventless and direct-vent fireplaces when he was in Las Vegas recently for the International Builders’ Show. “I was just walking through the show, and the different sizes and configurations I saw were just phenomenal,” he said. “Even remodelers are taking advantage of the option of putting them in kitchens, bedrooms; I’ve even seen these fireplaces in bathrooms.” The fireplaces are also increasingly popular because of their efficiency. “Direct-vent can be 70% to 80% efficient,” said Steve Watters, sales manager of manufacturer Hamilton Parker. Ventless can be 99.3% efficient. In both cases, most of the heat is going into the house.” While traditional fireplaces remain the top choice for consumers, even the old-style brick-and-mortar units are unlike their drafty ancestors. Fireplaces today are 60% to 99% efficient, depending on the fuel source. The move is on to direct-vent, ventless and electric fireplaces because of their flexibility. (www.dispatch.com)
Columbus Dispatch (2/1/09); Tim Feran
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On Second Thought, No Grab Bars
In its 2007-2008 Consumer Preference Survey based on a national sample of questionnaires, NAHB has shed some light on what Baby Boomers want. Boomers strongly prefer single-level living with three bedrooms. Younger age groups want four bedrooms in a two-story house. Ease of maintenance, energy efficiency and an emphasis on quality were other preferences. “Boomers want to show they have arrived and are successful,” said Helen Velas, president of Eleni Interiors, a Naperville, Ill.-based home decorating firm. “Boomers are ready for their dream home. That could mean remodeling or buying an existing or new home. They want to go to the next level — granite countertops, walk-in showers, faux finishes on walls, architectural details like art niches, built-in bars, wine cellars, several plasma TVs, under-cabinet lighting. They want the home to be their castle,” she said. Velas breaks down the 45 to 63 age range into younger Boomers and older Boomers, who are at very different stages of their lives. “Younger Boomers think getting old is so far away that they haven’t addressed the possibility. They haven’t given a high priority to housing features that will ease aging in place. Those features, such as wider doorways and brighter lighting, will make it possible to stay in a house and live independently as long as possible,” Velas said. “Universal products for handicapped accessibility can be smart and beautiful in design,” she added. But most Boomers don’t even want to think about universal products. (www.chicagotribune.com)
Chicago Tribune (2/6/09); John Handley
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