A Nascent Recovery: Overlooked Signs the U.S. Housing Market Is Turning
In the Sacramento Delta suburbs east of San Francisco — where home prices soared and fell as viciously as anywhere in the country — a housing market rebound is feverishly underway. A 1,600-square-foot rancher in Antioch listed for $179,000 — after last selling for $425,000 in 2004 — drew multiple offers last month with a high of $210,000 in cash. The property was a “short sale” whose owner needs lender approval to sell for less than the mortgage owed — and which buyers wouldn’t touch just three months ago. “My phone was ringing off the hook, my voice mail was on overload and people were coming into the office receptionist saying they couldn’t reach me,” said Christy Howard, a Coldwell Banker Coon and McCreary agent who listed the house. “Everyone was waiting for the bottom, and the problem is they waited too long, because the bottom has already come and gone.” Spurred by markdowns up to 80% from market highs, first-time buyers and investors both American and foreign descended en masse in the last three months on San Francisco’s hardest-hit hinterlands as Wall Street and the economic climate improved. They’re picking clean the Delta region’s bank-owned inventory as soon as properties hit the market and are engaged in unprecedented bidding wars even on short sales. The panicked buying — fueled by buyers fearing they will miss out on fire-sale prices — belies the doom-and-gloom evoked by recent reports of rising mortgage delinquency rates and foreclosure activity. After spending most of the 1990s in the $250,000 range, the median-priced home that was sold in the seven-county San Francisco area rose to a staggering $850,000 by its May 2007 peak. It since fell to a low of $399,000 in February — a 53% drop in just 21 months — before posting its first monthly gain in March, a 1% uptick. (www.marketwatch.com)
MarketWatch (6/5/09); Chris Pummer
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Green Home Builders Facing New Economic Reality
Although green building has not been spared from the economic gloom that has affected every sector of the housing industry, many builders are finding that green has given them an upper hand in helping survive the market. Some are even thriving due to increasing demand for eco-friendly dwellings, new funds for green public projects and passage of the $787 billion federal economic stimulus bill. Ironically, regions that have been on the forefront of the green movement seem to have been hit the hardest by the slowdown. Green builders in California, Colorado and New Mexico are suffering more than those in other areas because the general construction market is doing so poorly. Heather Ferrier of Ferrier Custom Homes in Ft. Worth, Texas, says the stock market decline had the biggest impact on her family’s sustainable building business. “We had clients who overnight were severely impacted by the plunge, which caused their home building plans to be postponed, in some cases indefinitely.” But Ferrier says other clients have recommitted themselves to building sustainable homes. “For those individuals, the current market conditions have only refueled their passion to move forward with building sustainable homes,” she said. Ferrier Homes is having a record year. “The experienced green builders who have been doing this for a while — who know that green is more than just a fad,” are surviving and even thriving, she said. “Those who are truly committed, and have established themselves as so, are riding it out.” Chevy Chase, Md.-based Bethesda Bungalows also is riding the wave of interest in sustainable and energy-efficient homes. The company is known for building small- to medium-sized green residences on infill lots in Washington, D.C.’s close-in neighborhoods. While the market for spec homes has dramatically dropped, vice president Brad Beeson says the company’s custom home business is thriving. “It’s been really busy — super busy,” he said. “A lot of it is because we are known locally as a green builder. That has been really good for business.” (www.ecohomemagazine.com)
EcoHome Magazine (6/3/09); Jennifer Goodman
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Prefab Homes Sprout Green Designs, Improve Affordability
Michelle Kaufmann couldn’t find an affordable, eco-friendly home in the San Francisco area in 2003, so she built her own. Construction took 14 months. “This needs to be easier,” the architect recalls thinking. To make green homes more accessible, she says, she “stalked” factories until she found some that agreed to build her modern designs. She built dozens of prefabricated homes, including several identical to her own, each taking four months at 15% less cost. Last week, however, she began closing her firm. “We have tons of work,” she says, but her clients can’t get financing and two factory partners went out of business. She will continue her work as a consultant. Kaufmann is one of a growing cadre of architects and builders who, with varying luck, have turned to factories to build green. The homes range from simple cottages, available for less than $100,000, to high-end showpieces at $1 million or more. These “modular” homes are built to local codes and set on permanent foundations. They often consist of several customized modules that are pieced together at the property. “It’s the future,” says David Johnston, Colorado-based author of “Green From the Ground Up.” In the past year, Johnston has held green-building workshops at factories in several states. Despite Kaufmann’s experience, other companies report widespread interest from customers and expect orders to pick up once the economy recovers. “We’re already seeing the boom,” says Maura McCarthy, co-founder of Blu Homes in Waltham, Mass. The green modular builder, which has its own factory plus partners in three other states, launched its Web site in July. It has four homes nearing completion and a dozen more in the pipeline. (www.usatoday.com)
USA Today (6/1/09); Wendy Koch
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Seniors Want to Age at Home, But Will Builders Adapt?
Senior advocates say that 85% of the elderly want to remain at home as they age as opposed to moving into care facilities. Emerging technologies that are still not widely known could help them do that. There are systems available to test cognitive abilities daily, track vital signs and plot their movements by using motion detectors and pressure pads. The results can be continuously uploaded to the Internet and sent to children, physicians or caregivers. The question is whether builders and the nation’s older home buyers are catching on to these technologies, which can be hard to retrofit to existing homes but could be easily and cheaply accommodated in newly constructed ones as part of the design process. Some builders who concentrate on “active adult” communities de-emphasize features related to age and health issues — largely because their buyers don’t want to think about them. Instead, they hype bigger great rooms for entertaining guests and amenity-packed clubhouses. “Baby boomers are never going to get old,” joked Edward Johanson, a boomer himself and president of Lakemont Homes. The Roseville, Calif. company partners with Eskaton, a provider of senior housing and services. The partnership is building homes in Roseville and Placerville, Calif. aimed at 65-year-olds and above, and buyers in this group are more attuned to health needs than the slightly younger boomers. The homes Johanson is building include the physical characteristics residents will need later in life, such as wheelchair access to all areas. The effort adds about $6,000 to $8,000 per home, including wiring for advanced technologies. But while they also include technological upgrades, such as more wiring capacity, he said many of the new technologies are too new to generate much interest. “We are not rolling that out in a comprehensive fashion,” he said. “We do anticipate, like many technologies, that it will grow very fast.” (www.sacramento.bizjournals.com)
Sacramento Business Journal (5/15/09); Michael Shaw
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The Most Dangerous Room in the House?
Although the federal Centers for Disease Control and Prevention compiles statistics on falls, it doesn’t track where falls occur. It is known, however, that bathrooms greatly trouble the people charged with retrofitting homes for the disabled, young and old. Bathrooms abound in hard surfaces — tile, porcelain, cast iron, marble — that get wet and slick. People often use them at night, when they’re less alert. Everyday actions such as closing your eyes to rinse off shampoo can throw off your balance. “Bathroom falls are major bone-breakers, particularly for older women with osteoporosis,” said Kent Mickelson, director of the Center for Independence of the Disabled. To make bathrooms safer for seniors, specialists suggest: a handheld shower and a bench to sit on, a higher toilet seat that makes it easier to sit and rise, grab bars, adequate lighting and floors free of scatter rugs. Almost 400 independent living centers across the country provide assessments and home modifications, or refer to local companies that do. NAHB has also trained more than 2,500 certified aging-in-place specialists (CAPS) who’ve completed a three-class course. (www.nytimes.com)
New York Times (5/28/09); Paula Span
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Bringing the Inside Out; Backyard Kitchens Offer Convenience While Increasing Home’s Value
Even in a city like Chicago with its frigid winters, an outdoor kitchen is a popular feature that adds value to the home and provides an additional fun area for family enjoyment and entertaining. According to the Propane Education & Research Council, more than half of all grill owners use their grills year round. “I have people asking me about outdoor kitchens all the time,” said John Hirsch, owner of Krugel Cobbles in Lake Bluff, Ill., which builds about five outdoor kitchens a year. In this soft real estate market, an outdoor kitchen could help clinch a sale, because a complete outdoor kitchen increases the value of a home comparable to an indoor kitchen remodel, according to NAHB. Russ Faulk of Kalamazoo Outdoor Gourmet, a manufacturer of outdoor cooking appliances, said that traditional kitchen design should be considered — including cold areas, hot areas, wet areas and dry areas, as well as adequate counter space. He recommended the National Kitchen & Bath Association’s Kitchen Planning Guidelines as a good resource. The materials used to build the kitchen should be able to withstand outdoor conditions and be easily cleaned and grease-resistant — such as stainless steel, stone and tile. Pergolas or awnings should be considered to provide shade and shelter from rain. Natural gas patio heaters, portable propane patio heaters, radiant heat under patio tiles and countertops, fireplaces and hearths all extend the use of an outdoor kitchen into cool weather. (www.suntimes.com)
Chicago Sun Times (5/31/09); Shirley Remes
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