Researcher Clear Capital created a list of markets, with expected changes in house price changes to the good, and to the bad. Many Florida markets made the list, to the good side.

reprinted from Builder Magazine

Plansource remains a portal of information on the homebuilding industry.

Designing a home for today’s consumer is challenging, given the market dynamics, competitive environment, changing demographics and financial and time constraints. Successful designers create from research and experience.   They:

• Know what motivates today’s buyers
• Understand their lifestyles
• Know what products and features are important to them
• Measure the cost/benefits
• Understand the options available elsewhere
• Have the pulse of changing market dynamics

• Design cannot be successful without all of these components.

  Design is a top priority for consumers today. Good design is the balance consumers are looking for in order to motivate them to make a purchase. As shown in the graph below, “home style and design” ranked second in our survey of 10,000 prospective buyers across the nation – second only to the most important investment rule in real estate: “location, location, location.” Interestingly, price ranked below location and design nationally and in many parts of the country. Location, design and price ranked among the top three priorities in all MSAs reported (although not always in this exact order for every MSA).

  

  What does home style and design mean? While architecture varies by region, location and demographic profile, our survey findings showed that consumer preferences were not significantly different throughout the country. The biggest differences were dictated by household size and family status, coupled with the financial realities in each market. For example, the Texas buyer can afford a lot more home than the Washington, D.C. buyer.

  Profitable Design in 2011: We are seeing all sorts of creative design in the market, with many of the best-designed homes outselling the competition by 300%.

Plansource, Inc. remains a portal of information for homebuilders throughout Florida and the southeastern United States.  www.plansonline.com.  Reprinted John Burns Real Estate Consulting.

The disparity between these two groups of homes matters, because  prices of the good properties remain relatively strong recently, as prices of worse properties have declined. This means that it’s those run-down, dilapidated foreclosed homes and short sales that will disproportionally bring down aggregate home prices, while well-kept homes should see much smaller price declines, or even appreciation.

Sellers need their house to appear as pristine as possible to appear to buyers. But his observation could have another logical conclusion: the market could be ripe for some renovate-and-flip business.

Let’s continue with Florida as an example. The foreclosure discount for the state was 27% in the first quarter, according to RealtyTrac. So let’s say a foreclosed home’s list price is $250,000, but it sells for $182,500 due to that discount. If that buyer puts $35,000 into the home to give it a facelift and a few key upgrades, it may achieve a price close to the list price at resale, assuming experience holds. That would provide a 15% return on investment in probably for a few months work.

This doesn’t mean that all foreclosures could be easily revitalized. Savvy investors would have to be able to tell apart those that have potential to be converted into more desirable homes without an excessive investment from those that don’t. Floor plan and location are probably key characteristics in that determination. But more home flipping could be another part of the answer to working through some of the immense housing inventory out there.

This gives investors two options: revitalize the foreclosures that have sale potential and rent out the others. If the inventory is tackled through these strategies, then price aren’t going to suddenly soar, but they could begin to stabilize sooner.

Plansource, Inc. www.plansonline.com remains a portal for information for the homebuilding industry.

Reprinted from Atlantic

Plansource, Inc. will continue to do its own order fulfillment to ensure the standards for Florida’s complex building code are met.  Custom home and duplex designs, CD Roms of the drawing files, presentation artwork, writing architectural deed restrictions, and full design customization services of our single family and duplex catalogue plans are but a few of the many services we provide homebuilders in Florida and throughout the Southeast. 

 Since its inception in 1996, Plansource has focused on quality design and service for all of its clients.  Because the firm focuses only on residential design, Plansource is able to fully understand the needs of its clients, and the markets they build in.

Sponsored by the Florida Home Builders Association (FHBA), one of the largest professional associations of its kind, the Aurora Award design competition is presented to outstanding builders, planners, architects, developers, designers, interior merchandisers and other housing-related professionals within a 12-state SE and Eastern Caribbean region.

Winning the award garners respect and distinction and is recognized throughout the industry as the southeast region’s premier building and design competition.  Since its inception over 31 years ago, the Aurora Awards continues to be the major event at the Southeast Building Conference.

Plansource can be reached at www.plansonline.com.

Because the economic recession shrank their pool of immediately qualified customers, some builders also have begun to offer sidelined buyers financial counseling.

The fondest hope of homebuilders today is that they can get an edge against the foreclosure-ridden resale market that’s their fiercest competitor.

One large builder has taken on the resale market with its “builder short sale” that seeks to entice buyers by deeply slashing its new home prices for a limited time so they are more price competitive with foreclosures and resale homes that are listed at prices below their mortgages.

Today’s would-be buyers feel no sense of urgency and many are hesitating because they believe home prices could drop further.

The spring slump took builders by surprise. “Everyone in the industry at the beginning of this year felt we were at the cusp of a turning point and the market would gradually get better. Nobody expected a stall,” said Steve Johnson, a director in the Riverside office of MetroStudy, a real estate consulting firm.

NEW SUBDIVISIONS

“Builders that are going to survive have to step up and build a better house and be clicking on all cylinders,” said Matt Sauls, regional marketing director for Pardee Homes.

Pardee this year launched its Homeward Bound program to give potential buyers assistance with issues that have become vital to qualifying for a mortgage today — the need for good credit and cash for a down payment.

In recent weeks Pardee also started promoting a down payment assistance program for low to moderate income buyers with good credit, said Sauls.

The program gives down payment assistance through the state of California by providing grants for 3 percent of the purchase price of a home selling for up to $417,000.

Pardee’s marketing message, which the builder has placed on its billboards, says a home can be purchased with $999 down. That is figured on the purchase of a $199,800 house, which Sauls said is in the price range of homes Pardee is selling in Beaumont and Lake Elsinore.

Pardee’s low down payment advertisement has created “a nice and steady surge in traffic and sales,” Sauls said.

IMPROVED DESIGN

Because resale homes today frequently sell for less than the cost to replace them, it doesn’t make sense for homebuilders to compete primarily by lowering their own prices, say real estate experts.

The need to find a way to differentiate new homes has prompted the homebuilding industry to invest in improved design and energy efficiency.

Carina Hathaway, vice president of marketing for Brookfield Homes, said design features of homes that Brookfield will offer for sale in Ontario later this year resulted from extensive consumer research and include a kitchen island large enough to seat five people, extra storage space in the garage, an extremely large family gathering space, and eight-foot-high French doors to let in an abundance of sunlight.

LOWER UTILITY BILLS

Also many homebuilders are heavily marketing more technological design features-like extra insulation, programmable thermostats, heat deflecting windows and rooftop solar panels — all aimed at lowering a homebuyer’s monthly utility bills.

The environmental advantages of conservation are clear. But builders say in this economy buyers are more interested in how energy and water efficient construction will make home ownership more affordable.

Another large builder is efficiency testing all of its model homes and putting a sticker on each to inform prospective buyers how much the average utility bill for that home will be. Other builders also are taking pains to spell out the savings buyers can expect from the energy saving features they are employing.

“I think it is what separates new homes from used homes. All of our homes are at a minimum Energy Star (rated) and that is 15 percent better than code and significantly better than a used home. 

Plansource focuses on providing up-to-date information on the housing market for its clients.  www.plansonline.com

Reprinted from Builder Magazine

Sales were at seasonally adjusted annual rate of 323,000 in April, well ahead of the 300,000 median economist estimates of the month according to surveys from Dow Jones, Bloomberg and Reuters. That would have matched March’s number. February sales were at a record-low 278,000.

Sales are still well 23 percent below last April, when home sales were receiving a boost from the approaching expiration of the federal tax credit.

The higher pace and declining inventory left a 6.5 month supply of homes for sale on the market, down from 7.2 months in March. The 175,000 new homes for sale in April were a record low. 

The median sale price for a new home was $217,900 in April, up 1.6 percent from March and 4.6 percent from April 2010

Plansource, Inc. www.plansonline.com remains a portal of home information for builders and consumers.

Reprinted from Professional Builder.

Fully eight-in-ten (81%) adults agree that buying a home is the best long-term investment a person can make, according a nationwide Pew Research Center survey of 2,142 adults conducted from March 15 to March 29, 2011.

There has been some falloff in the intensity of the public’s faith. Today, 37% ‘strongly agree’ while 44% ‘somewhat agree’ that homeownership is the best investment a person can make.

When this same question was asked two decades ago in a CBS News/New York Times survey, 49% ‘strongly agreed’ and 35% ‘somewhat agreed.’”

Good enough to believe that when a paycheck-to-paycheck household can get a home loan, demand will be there. 

Plansource, Inc. www.plansonline.com  remains a portal of information to homebuilders and homebuyers.  Reprinted from Pew Research.

Now, as the market begins to thaw somewhat, some builders are questioning that move. It may not be what the buyers of new homes, as opposed to resales, want. Consumer research consistently shows that a chief attraction of new homes is the opportunity to customize.

One homebuilder recently changed its marketing direction after market research showed buyers wanted more design choices in buying a new home. They not only allows buyers to select finishes, but they can make structural changes as well. Thanks to strong operating controls, the company still manages to meet its goal of building homes in 54 working days.

This change in emphasis probably doesn’t work for every builder. The industry has always split between companies that strive for the highest value proposition (and ultimately the highest return on capital) and others that stress design flexibility (and ultimately the highest margins).

It’s just that with trade-up buyers largely absent from the market in recent years, it hasn’t been easy to go for add-on sales. Now, with discretionary buyers returning in small numbers, we will no doubt see more of it.

Reprinted from Builder Magazine

The latest Raymond James & Associates housing update for Florida makes one thing perfectly clear. The magnitude of the dysfunction in the market right now—with almost one-in-four mortgages in some form of delinquency—measures the hugeness of the opportunity in the months ahead. Some of that opportunity, thanks to the broken foreclosure pipeline, may be for new-home builders who can leverage being able to deliver a title-clear offering to their advantage. Big Builder reports.

Plansource, Inc. remains a portal for information on the homebuilding industry.