Posts Tagged ‘Homes’

Is Now A Good Time to Buy A House?

July 7, 2008

   When I called Sandi Green to get a state of the state of real estate in the Columbus area, I was prepared to hear her say that business is great. Sandi is president of the Columbus Board of Realtors. She also sells for Waddell Realty Company. The reason I was prepared to hear that business is great is that over the years I have come to the conclusion that no matter how business really is a sales person will say it’s great. I figured it was simply a matter of sales psychology. You could say that I have become cynical, but I like the term skeptical better. After all, I was in the news business for more than half a century and you had better be skeptical if you want to be a decent reporter.

 

Sandi Green
Columbus Board of Realtors President
  Refreshingly, I have come across some car sales people who admitted that business is lousy right now. Sandi didn’t, to her credit, say business is great, but she made it clear that she was doing fine, as well as most of the old established real estate agents. They, she says, have built up a large enough loyal client base to keep them busy. It’s the newer agents who are having a tougher time right now. 

 

  Are prices down, I asked her. “No,” she said, but qualified that statement with, “but some people are accepting less than the appraised value to sell their home. Let’s say you got a job in New York and you can’t afford to pay rent there and a house payment in Columbus; you’ll take less.”

 

  “Now,” she said, “this will cause the comp price to come down in the future.” I asked her to translate the real estate jargon phrase “comp price” for ordinary folks like me. “That means comparable price. You sell your house for less and that brings down the appraised price in the future. That also can help bring down the appraised value of other houses in the same neighborhood.”

 

  While saying the older established agents are still selling well, she did admit that the inventory of homes for sale is large right now. “People are hearing these stories in the media about the national housing slump and become frightened and that affects their decisions to buy or sell. Like, I always say, like politics, all real estate is local. The Columbus economy is not like the national economy. It’s good, and it’s going to get even better with all of those people coming in here because of Fort Benning getting more troops and the big Kia plant being built at West Point.”

 

  What about all of those foreclosures?

 

 “Well, there has been a lot of that for those people who had those sub-prime loans.”

 

  How well are those homes reselling?

 

“Some are selling, but sometimes less than appraised value. I know of one home that was first sold for 490 thousand dollars and was resold for 265 thousand. There is some problem with selling those, because when people see a bunch of them up for sale on one street in a neighborhood, they become a little afraid to buy them.”

 

 

  In summary:

 

 – There are a lot of homes for sale right now and a lot of people are taking less than the asking price.

 

– That could bring down prices in the future.

 

– News about the national economy and home sales slump has affected the Columbus market irrationally because the Columbus economy is good and promises to get better. 

 

– Bottom line: it’s a good time to buy a home. (I get the feeling that real estate agents always say that, and, for them, that’s true.) But, if you wait a little, it could be an even better time because people taking less than the appraised value now will possibly bring down appraisals in the future.

 

 

 

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BRAC Brings Big Volume Home Builders from Out of Town

June 25, 2008

  Howard Jefferson tells me that some local home builders are not happy with him. He says it’s because his company is working hand in glove with out-of-town builders who are building homes cheaper than they can. Howard is the Principal Alabama Broker for Coldwell Banker Kennon Parker Duncan & Key. (Disclosure: we are in the same Rotary club.) He has empathy for the local builders, many of whom he has worked with over the years, but says the large building firms are a reality of the times.

 

 

 

Howard Jefferson

Coldwell Banker Kennon Parker Duncan & Key

 

 

  The thing about it, though, is that, during this housing sales slump, his firm is selling a lot of new houses. And, with BRAC bringing close to 30,000 new people into the area, they expect to sell a lot more.  The reason the houses built by huge out-of-town firms are selling is simple: price. 

 

  The main action right now is in Russell and Lee Counties, and Phenix City in Alabama. “There is more land available, and you get more house for the money, and taxes are lower than in Columbus,” he told me.  He should know; he heads up the Coldwell Banker group in the Russell and Lee Counties’ area of Alabama. 

 

“We are the number one real estate company in this area.  We get a 35 percent share of all homes listed in Columbus, and a 40 percent share in the Phenix City, Russell and Lee County area.” 

 

  Howard took me on a tour of the Fort Mitchell area which was an eye-opener. First of all, he took me to a subdivision built by local builders that have a lot of houses for sale. Then he took me to Villages at Westgate, which is close to the Fort Benning west gate, the one that’s on the back side of Lawson Field.

 

 

 

Fort Benning’s West Gate

 

 

 

 These houses are selling just about as fast as they can build them, which shows that you don’t have to wait for BRAC to sell homes to Fort Benning soldiers. Tim Drew, a realtor on the site, says about 60 percent of home owners at Westgate are soldiers and their families.

 

 

 

Villages at Westgate

 

 

  Coldwell Bankers is selling them for Scenic Homes, which is headquartered in Snellville, Georgia. Scenic has constructed more than 5,000 homes in Georgia, Louisiana, North and South Carolina.  It’s the 54th largest builder in the country. Scenic claims that “Scenic Homes offers a wide variety of floor plans with up to approximately 2,900 square feet at a fraction of the cost of their competitors.”  Actually, according to Drew, the homes get as large as 3,059 square feet.

 

How can they do that?  For one thing, economy of scale. They can get better prices for building materials because of the large quantities they buy. Also, they have cheap labor, Howard told me. Who else makes tons of money using that philosophy? How about Wal-Mart?

 

  The houses in Westgate are impressive. It’s hard to believe that you can get such a large, new home for the price. 

 

 

 

 

 

 Great Room of a Westgate home

 

 

 

 

 

These homes range in price from $169,000 to $203,000. Coldwell Banker has already sold more than a hundred of them, and expects, before it’s all over, to sell more than 700 of them. The Fort Mitchell area is expected to grow by at least three thousand people as a result of the move of the 3rd Armor School to Fort Benning starting in the 4th quarter of next year.

 

    We’ll continue our look at the way BRAC will affect our area in future posts. Stay tuned.