Future Real Estate Markets Shed Some Mystery A new monthly Pending Home Sales Index from the National Association of Realtors® will provide national and regional information that can be used to predict existing-home sales a month or two ahead. The index will compile pending single-family home, condominium and co-op sales data from more than 100 Multiple Listing Services and 60 large brokers, which represent about 20% of all real estate transactions. More than 80% of all pending home sales go to settlement within one or two months, and most of the others go to closing within three to four months, according to the association. Only 2% of pending transactions don’t result in completed sales. NAHB Chief Economist David Seiders said that the new index “is a welcome addition to the housing data system. Right now, we are not sure how we would use this series but we will continue to analyze its value to our members.” (www.inman.com)
Inman News (3/10/05); Glenn Roberts Jr. [Return to top]
House Rules: No Restrictions; For One Family; Universal Design Opens Doors Once Closed In planning for the construction of a new home in Washington, D.C., a modern appearance was important for Lewis and Tamara Kessler, but of even more paramount concern were universal design features. One of their twin daughters was born with cerebral palsy and uses a wheelchair or walker to move around. From a list of universal features from the Center for Universal Design at North Carolina State University in Raleigh, the Kesslers decided they couldn’t live without: a subtly graded ramp to the front door; an open plan on the main floor with space in each room to accommodate full radial wheelchair turns; extra-wide doorways with flush thresholds; grab bars in the showers; wheel-under sinks and work stations; and an elevator large enough for a wheelchair and one other person and with access to every floor. Other features include bathroom faucets turned on and off with infrared sensors or placed close to the counter edge; a curbless shower; a movable wand showerhead at arm level; sturdy gates at the top of each stairwell; and kitchen appliances built close to the ground. The final cost of building the 3,000-square-foot house, not including architect’s fees and the lot, came to $540,000 or $180 a square foot. According to Alexandria, Va., architect Robert Gurney, the biggest challenge wasn’t integrating universal design into his plan. It was trying to build a house on a 50-foot-wide lot and include a 75-foot long pool. (www.washingtonpost.com)
Washington Post (3/10/05); Jeff Turrentine [Return to top]
Silicon Valley Home Prices Suprass $700,000 According to the Bay Area Real Estate Market Newsletter compiled by Richard Calhoun, the median price of single-family detached homes and condos in Santa Clara County, Calif. — considered the heart of Silicon Valley — both rose $41,000 in February, driven by first-time home buyers out to beat the spring rush and profit-taking move-up buyers. The median price of a condo was $451,000, up $100,000 over a year earlier, and single-family homes rose to a record median of $705,000, up $140,000 in a year. Calhoun said on March 8 that in a region of 1.5 million people, there were only three single-family detached homes on the market priced under $400,000 and about 66% of the homes were selling for more than the asking price, on average, 3.6% more. Lenders are so confident about the market, says mortgage broker Brandon Knapp of Lawson & Associates Mortgage Planners in Campbell, Calif., that “they are allowing debt-to-income ratios of 55%. Lenders are accommodating the cost of housing because they feel it’s a great investment.” (www.realtytimes.com)
Realty Times (3/9/05); Broderick Perkins [Return to top]
Condo Fever Reaches New Heights in Miami In Miami-Dade County, Fla., 48,000 condominiums — including condo-hotel units — had been proposed, planned or were under construction at the start of this year, according to the South Florida office of Integra Realty Resources. What is likely to happen, if the area’s condo bubble does burst, is that projects will be finished and buyers will close, but the buyers may not be the same people who originally put down deposits because some contracts will be flipped before closing, said Carlos Berner, president of JBM Capital Advisors in Miami. As many as 25% of the units that are planned probably will not be built, says Jack Winston, a residential real estate analyst at Goodkin Consulting in Miami, for one reason because construction costs are too high; they rose 12%-17% in the last 12 months. Berner says there is an oversupply of high-end units selling for $400,000 and up and a need for more affordable units priced below $250,000. Complicating the picture for Miami’s condo market are the Latin Americans and Europeans who have been buying the city’s apartments as second homes. (www.nreionline.com)
National Real Estate Investor (3/1/05); Hortense Leon [Return to top]
Eco-Radicals Target Growth in Sierra Hills Auburn, Calif., a quaint Gold Rush town in the Sierra foothills on the way to Lake Tahoe, along with fast-growing communities nearby, has attracted the attention of the Earth Liberation Front in the last three months. In December, crude incendiary devices were found in three houses being built at a luxury subdivision in Lincoln, along with graffiti that read, “Enjoy the world as is — as long as you can.” In January, five more devices were found at a commercial building under construction in Auburn. And last month, a newly built apartment complex in Sutter Creek was targeted, but a sprinkler system rendered most of the incendiary devices useless before they went off. While ELF has been tough to crack because its members operate in autonomous cells and are savvy about technology, surveillance and forensics, a 21-year-old resident of Newcastle has been indicted in all three incidents and denied bail. He lives with his parents on a 17-acre mandarin orange orchard. (www.mercurynews.com)
San Diego Mercury News (3/9/05); Dana Hull [Return to top]
Battle Brews Over Rise of Studio Digs Nine complexes totaling nearly 500 units of market-rate “nano-studios” with 350 square feet or less of living space are under construction or seeking city approval in San Francisco, but the city supervisor and others say the single room occupancy units should be available solely for low- or very-low income residents. The city’s planning commission has been considering a proposal that would limit availability of the units to individuals earning no more than $39,600 a year. One of the developers wants to charge rents of $750-$1,000 for his complex and another is hoping to sell his mini-homes for $300,000 and less, waiting to see what the market will bear. Under current law, 10%-12% of all new SRO complexes with 10 or more units must be reserved for median-income residents earning around $47,000 annually. (www.bizjournals.com)
San Francisco Business Times (2/7/05); Lizette Wilson [Return to top]
Eminent Domain Has Two Issues York County Commissioners in Pennslyvania voted two to one in May to take the property of developer Peter Alecxih Jr. for a proposed park, the Susquehanna Riverlands Preservation Project. Alecxih has objected because he has plans to build 51 homes on the land, arguing that the government’s need for his property isn’t compelling enough to justify acquiring it through eminent domain. He also says he will never get the same kind of money from government compensation as he would have received from developing the land as he originally planned. He says his land is worth $13 million. Mary Lynn Pickel, director of legislative services for NAHB, wouldn’t comment specifically on the dispute, but she said that disputes over eminent domain come down to two basic issues: whether the public necessity is compelling enough or whether the property owner is being compensated what the property is worth. The majority of disputes by far involve the latter issue, but the issue of what constitutes public necessity can be tricky. There is legal precedent for taking land in order to build a public park. (www.ydr.com)
York Daily Record/Sunday News (3/8/05); Tom Joyce [Return to top]
Adjustables Lose Their Edge The spread between fixed and adjustable mortgage rates is narrowing fast and is roughly only half of what it was a few months ago, according to Freddie Mac, prompting lenders to once again offer ever larger discounts to encourage borrowers to consider ARMs. In January, lenders were offering discounts of 1.5 percentage points, compared to 0.36% a year earlier. Since 1984, the average has been 1.7 points, but there have been times when write-downs have been two or three points. Ongoing efforts of the Federal Reserve Board to raise interest rates since last June have had a greater effect on the short-term rates than long- and medium-term loans with fixed rates and payments, which last year accounted for nearly two-thirds of all conventional home-purchase loans. Even discounted adjustable-rate mortgages aren’t much of a bargain these days and they can lead in as early as one year to higher monthly payments than those on a fixed-rate loan. (www.latimes.com)
Los Angeles Times (3/6/05); Lew Sichelman [Return to top]
Remodeling Can Put Trees in Tight Spot; Arborists Can Help Owners Preserve Valuable Assets Home owners in Arlington, Va., who wanted to add on to the back of their home without disturbing a towering oak less than eight feet behind their house decided to push out the back wall by three feet to support another bedroom upstairs over a roomier kitchen. After consulting with a tree expert, the remodeler set the kitchen bump-out on piers rather than on a solid foundation. The holes for the piers were dug by hand and were unevenly spaced to avoid damaging large roots, and a beam was doubled up to compensate for the uneven spacing. Cutting roots, compacting soil and damaging tree bark are the three things to be avoided during construction, according to Lew Bloch, a certified arborist and president of Bloch Consulting Group LLC in Potomac. Md. Building a new foundation by digging a continuous trench through a tree’s roots is asking for trouble, Bloch said. “A better methodology is to insert piers through the root system and then bridge those with steel I-beams.” According to NAHB, a landscaped home commands a higher price than a barren lot, as much as 15% more. www.washingtonpost.com
Washington Post (2/5/05); Lois M. Baron | 
