Residential Builders See Big Opportunity in Overseas Markets
Some of the top residential builders in the United States are expanding into foreign markets. Individually, Los Angeles-based KB Home has opened a design showroom in France; Pulte Homes Inc. is active in the Mexican and Argentine markets; and K. Hovnanian has dabbled in Poland's residential market. Those efforts are applauded by the Commerce Department, which is encouraging movement into China; and NAHB, which is promoting opportunities in Eastern Europe. NAHB also launched the "Access Mexico" program in 2003 to help U.S. builders take advantage of opportunities there. Some observers believe New Zealand and other English-speaking countries provide a comfortable atmosphere for American builders. Though New Zealand produces only 30,000 new homes each year — compared to more than 1 million annually in the U.S. — experts see similarities between the two housing markets, considering that both have been fueled by low interest rates and immigration. However, domestic builders have focused their efforts on huge dwellings jam-packed with amenities; while an aversion to suburban sprawl makes dense, multifamily projects popular in New Zealand. (www.philly.com)
Philadelphia Inquirer (07/26/04) Heavens, Alan J.
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Beyond the Summer Cabin: Vacation-Home Alternatives
The National Association of Realtors® reports that the number of Americans who own second homes has increased by 25% since 1989 to about 5.1 million, with average prices for vacation properties hovering near the $200,000 mark. At the same time, two new vacation-home options have emerged for consumers who want to avoid the hassles and extra costs of full ownership, such as property taxes and upkeep. Some developers are offering "fractional ownership" or "shares" of units at posh resorts. The units, which can range from studios to two- and three-bedroom condominiums, sell for a one-time price, usually between $300,000 and $500,000, with additional maintenance fees ranging from $450 to $14,000 annually. Depending on the deal, owners can reserve the resort for as little as one month or as much as 13 weeks at a time; but one of the drawbacks is that availability may be somewhat limited. Meanwhile, "vacation clubs" are similar in that buyers pay a one-time membership fee, usually for a few thousand dollars, and then pay up to $25,000 in annual maintenance fees. They differ in that members have access to a number of different destinations worldwide for several weeks at a time. Unlike fractional ownership programs, however, vacation clubs do not generate a profit upon resale. (www.wsj.com)
Wall Street Journal (07/29/04) P. D1; Lieber, Ron; Opdyke, Jeff D.
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Models, Web Work in Tandem
Many buyers of both new and resale properties begin their searches on the Internet, perusing listings that feature complete property descriptions, floor plans and even virtual tours. According to Michael Copp of NAHB's National Sales and Marketing Council, most new-home buyers use the Web to prequalify builders. While some builders have been able to sell a majority of their units without models, most continue to build them to showcase the latest trends and popular upgrades. Others opt for design centers or "staged" homes outfitted with only standard features instead. "We build models to give people ideas of what they can do with their homes with upgrades," remarks Centex Homes Sales and Marketing Director Charlie Roter. "We also show them homes under construction so they can see what it normally comes with." Despite the popularity of Web-site listings and virtual tours, builders tend to agree that computer models will not eliminate the need for furnished models. (www.sanluisobispo.com)
San Luis Obispo Tribune (07/25/04) Stevens, Leslie E.
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A New Nest
Though more baby boomers are relocating to the urban core when they retire, most continue to retreat to suburban active-adult communities. The newest active-adult developments are located outside of metropolitan areas in the Southwest, Colorado and Florida. Baby boomers typically relocate to these communities after their children leave the nest but well before they reach the traditional retirement age. A recent survey by AARP reveals that 80% of respondents plan to remain employed after they turn 65, and many will serve as consultants or work from their homes. According to State University of New York at Albany demographics professor William Frey, "The difference between the baby boomers and their parents is that the parents were willing to defer gratification until they reached retirement age, while the baby boomers want it all now." Meanwhile, close to 25% of respondents to a poll conducted by Pulte Homes' Del Webb unit expect their kids to move back in; and another 24% believe they will end up taking in their parents to care for them. (www.phillyom)
Philadelphia Inquirer (07/25/04) P. J1; Heavens, Alan J.
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Model Worth More Than Scale
Architects often recommend that new-home buyers commission a scale model of their planned residence so that they can fully picture how the final product will look. Scale models benefit the architects as well because they allow them to make design adjustments at the clients' request before permanent structures are built. Traditional floor plans, many architects say, are not an accurate representation of how the design will translate in three dimensions. Models can take weeks or months to create; prices for a customized model start around $2,500 but can be much greater depending on the level of detail requested. Architects may assign scale model projects to their staffs or outsource to professional model makers. Most architectural degree programs include courses in model making. However, Amit Handyopadhyay, chairman of Farmingdale State University's architectural department, notes that models "are being overshadowed more and more by computer assisted design, both fixed and animated." (www.chicagotribune.com)
Chicago Tribune (07/25/04) Tyler, Jan
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Built-In Features Make Life Easier for Pets, You
Central Florida builder D.R. Horton Homes is incorporating animal-friendly features into the residences it designs through its new Pet Amenities Program and a partnership with PetSafe, a company that makes pet-safety products. Animal lovers can opt for common features like special pet doors or more advanced amenities such as discreet, ventilated litter boxes and easy-to-clean feeding areas. "We're constantly considering new options to offer, such as hurricane protection for pets and facilities for disabled animals," says Jack Appleman, director of sales and marketing for D.R. Horton. The company is both installing the features in existing dwellings and including them in designs for new homes at the customer's request. PetSafe donates 5% of all optional sale proceeds to the American Society for the Prevention of Cruelty to Animals, Cat Fanciers' Association and PAWS with a Cause. (www.orlandosentinel.com)
Orlando Sentinel (07/25/04) P. K6; Glick, Nancy N.
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The Vacation-Home Frontier
Vacation-home buyers and developers are setting their sights on remote, lesser-known locales as traditional hotspots like Nantucket, MA, and Hilton Head, SC, see their seasonal populations swell. Developers are building gated-developments with resort-style amenities in places like Hamilton, MT; Yemassee, SC; La Quinta, CA; Riceboro, GA; and Kremmling, CO, to name a few. In addition to privacy and security, they generally offer golf, tennis, a central clubhouse and community activities, with membership prices topping $100,000. Although they can get more for their money in obscure markets, some vacation-home buyers are hesitant because the resale potential of these communities remains unknown. While they can sell their memberships at a profit, purchasers generally need board approval before properties can change hands. Some buyers shy away from these developments because they would rather not submit their architectural plans for approval or attend social events. Nevertheless, the promise of rapid appreciation in both home and membership prices is sparking sales in many gated vacation-home communities. (www.wsj.com)
Wall Street Journal (07/23/04) P. W1; Reed, Danielle; Fletcher, June
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Survey Finds Housing Affordability Problems Hit Sales Clerks, Janitors the Hardest
A new report from the Center for Housing Policy shows that families relying solely on the income of someone working as an elementary school teacher, police officer or nurse would have problems buying a home in many of the largest housing markets in the country. Such households would have been priced out of 48 of 136 of the nation's biggest housing markets, including Boston and Seattle as well as many fast-growing metro areas of the South. The median salary of nurses rose 4% from 2001 to $33,000 in 2003, while the median salary of elementary school teachers and police officers rose nearly 3% and 7%, respectively, to $42,000 and $44,000. However, the median U.S. home price rose 9% to $170,000 last year. Barbara Lipman — who analyzed the data on behalf of the center, the research affiliate of the National Housing Conference coalition — said the benefits to the homeownership market from low interest rates basically are canceled out by the sweeping increases in property prices. (www.ap.org)
Associated Press (07/20/04) Armas, Genaro C.
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Programs Hope to Help Girls Build Careers in Construction
Teenage girls learn the basics of electrical wiring, welding, carpentry and safety procedures at a summer camp offered by BE&K Construction — a construction and engineering firm in Birmingham, AL. The program, taught mostly by female employees of BE&K, has been offered over the past four years and is designed to educate young girls about potential careers in the construction industry. The number of women in the overall sector — including office jobs — has grown about 9.6% from 718,000 of a total 7.5 million employees in 1994 to 975,000 of a total of 10.1 million last year, according to the Bureau of Labor Statistics; but insider estimates put the number of actual tradeswomen at only about 2% of total workers. Women still face many challenges in pursuing careers in construction, from on-the-job discrimination and unequal bathroom access to attitudes outside the workplace and the lack of child-care options. (www.wsj.com)
Wall Street Journal (07/20/04) P. B4; Maher, Kris
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Boomers Banking on Second Homes
Baby boomers are approaching retirement at a rapid clip, with 3.5 million turning 55 this year alone. Households headed by boomers over the age of 50 hold much of the country's wealth, with their median net worth rising from $98,000 in 1983 to $134,000 in 1998. This population segment is fueling second-home sales in resort markets, which National Association of Realtors® Chief Economist David Lereah attributes to their perception of real estate as a better investment than the stock market. Lereah believes demand from boomers will drive up vacation-home appreciation rates to more than two times the national rate of 6.7% this year. Low interest rates and new capital-gains tax laws that allow couples to avoid paying taxes on up to $500,000 of their property-sale profits also have bolstered second-home sales, though higher rates on mortgages and credit cards could eventually put a damper on the market. (www.nationalpost.com)
National Post (CAN) (07/20/04) P. FP4; Howley, Kathleen M.
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Seniors Get Relocation Help From Many Sources
Many new-home builders, assisted-living complexes and retirement communities offer executive-level relocation services to seniors facing a move from their family homes. These services typically involve move-in coordinators who suggest and monitor real estate agents and their marketing plans; locate moving companies and schedule the move; and arrange for the sale, donation or storage of excess belongings. Some even determine the home owner's routines, needs and preferences to create various floor plans for their new residences, allowing them to choose the one they like best. The professionals make the move easy for both developers and buyers, facilitating the sale of the senior's longtime home in an effort to keep the closing process and relocation on schedule. (www.chicagotribune.com)
Chicago Tribune (07/18/04) P. 3N; Adler, Jane
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Making Accommodations
According to AARP, 86% of the nation's senior population — which will be 40 million strong by 2010 — plans to age in place. Builders increasingly are including accessibility features in their new homes, which Fairfax, VA-based consultant Mike Leahy says adds just 3%-5% to construction costs. Remodeling existing dwellings to allow owners to remain independent can be cost-prohibitive, meanwhile, especially if the home lacks an entryway that can accommodate a wheelchair. Interior age-in-place features are more affordable and include wider doorways, levered door knobs, lower counters, higher dishwashers and ovens, shower grab bars and pedestal sinks. Home owners can even install hidden elevators and chair lifts to increase mobility. The nonprofit group Concrete Change is collaborating with city officials nationwide to change building codes to incorporate some of these features. The organization also encourages lenders to offer better mortgage rates to buyers of age-in-place homes. (www.cbs.marketwatch.com)
CBSMarketWatch.com (07/16/04) MacDonald, Jay
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Building Boom Drives Up Costs of Home-Construction Materials
Industry experts say that the prices of numerous key materials used in constructing new homes and for home remodeling continue to increase. A construction spurt in China is using up large amounts of American steel and cement, resulting in shortages in certain regional markets in the United States. In addition, U.S. lumber prices continue to grow. A primary reason for the steep costs is that while demand has risen over the past three years, production capacity has not expanded to meet it. Another issue is transportation, in the guise of higher gasoline prices and new federal regulations limiting how long a truck driver can be on the road without stopping. Domestic construction spending hit an unprecedented high in March with a seasonally adjusted yearly rate of $944.1 billion. (www.philly.com)
Philadelphia Inquirer (07/15/04) Heavens, Alan J.
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E-Mail in Your Hand, No Matter Where You Go
Although hybrid devices that combine voice and data services are becoming increasingly popular, businesses that prefer to keep their cell phones separate from their e-mail devices still have an array of options to choose from. Several makers of palmtops have issued products that integrate wireless connectivity using built-in Wi-Fi or Bluetooth connections that allow users to access their e-mail anytime and anyplace. Wi-Fi offers users faster connection to e-mail than do smart-phones — which combine mobile access to e-mail with cell phones, but Wi-Fi connections can sometimes take time to achieve, depending on users' locations. Dell's Axim X30 offers users the Pocket Outlook e-mail program and the latest version of Microsoft's mobile operating system. Other hand-held devices with built-in wireless connectivity include PalmOne's Tungsten C, which has a built-in "qwerty keyboard," and Tungsten T3, which offers users the ability to open their palmtop to create a bigger screen. When wireless connectivity is not possible, a variety of companies offer alternatives that allow palmtops to connect to the Internet through cables or the Ethernet. While smart phones and hybrid devices seem to be the focus of some in the market, users who prefer to use e-mail and talk on the phone using separate devices still have their choice of a variety of palmtops. (www.nytimes.com)
New York Times (07/22/04) P. E5; Fitzgerald, Thomas J.
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On the Road Again
About 40% of employees currently travel for business, a figure predicted to increase to around 66% by the end of 2006. As such, the need for new technological aids to keep business running well while on the road is rising. Laptop and tablet PCs, smart and wireless Internet phones, and portable printers are some of the devices that make life on the road easier for business travelers. New chip sets from Intel are providing increasing numbers of laptops with wireless capability. Tablet PCs — which provide screens a user can write on like a legal pad — are now available from two dozen manufacturers. Smart phones surf the Internet and provide non-phone services such as storing appointments and contacts and offer continual access to accompany e-mail. Recent advances in miniaturization, volume efficiencies and encryption have made wireless IP phones an inexpensive, secure prospect. In the last 18 months, portable printers have begun providing page-speed and photo-printing abilities similar to desktop models. (www.wsj.com)
Wall Street Journal (07/26/04) P. R1; McWilliams, Gary
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