Nov 13 2008 8:24AM | Permalink | Email this | Comments (0) |
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As builders contemplate the prospects for housing recovery in each of the many housing markets across this country, here's one more reason to maintain a high level of involvement in your state and local HBAs. We know that housing is a local business, driven in no small measure by job creation. Employment growth is the single biggest contributor to an increase in housing demand. And a major contributor to employment growth is a favorable state and local tax environment.
     Washington, D.C.-based The Tax Foundation recently released its 2009 State Business Tax Climate Index, which ranks all 50 state tax systems on the degree to which they are "business friendly," and a couple of things popped into my head while looking at the contrast between the friendliest ten states and the ten at the bottom of the rankings. The top ten are ...Read More

Nov 12 2008 8:33AM | Permalink | Email this | Comments (0) |
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Many builders I've spoken to over the past few months have told me they've stopped looking at acquisition deals for raw land, and suspended all land development operations. It's a logical step right now, when many housing markets have such a surplus of already-developed lots that you can buy lots for less than it would cost to develop from scratch. Still, my advice is to stay flexible, with the ability to jump back into land development fast, if and when it makes sense to do so.
     In the first place, if you build in a market where you needed to develop land in the past, it's probable that the market will eventually return to that state of affairs--the only question is, when? Secondly, infill is likely to be the name of the game for many builders for the next five years or more...Location is now more important than ever. And many of the...Read More

Oct 30 2008 7:42AM | Permalink | Email this | Comments (0) |
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Southern California-based builder management consultants Doug Wilson and Jack Robinson have an interesting opinion of where the housing market is heading, and it aligns with what fellow Californian (and Housing Giants columnist) John Burns has written for our publication: Check what houses were selling for in 2003, say Wilson and Robinson, because that's where prices will finally settle. Why? Because the price of homes in most markets in 2003 aligns with where job formation and household income are right now.
      "If jobs are created and household income goes up, the price of housing follows because there's more demand and more money to meet the demand," says Doug Wilson. "During the housing boom of the mid-2000s, government increased demand by low...Read More

Oct 29 2008 9:46AM | Permalink | Email this | Comments (0) |
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Here's a little silver lining to the clouds over Florida: One builder believes the housing market in Southwest Florida is now at supply/demand equilibrium, and he's putting his money behind that contention by opening two new projects.
     Pat Neal, president of Bradenton, Fla.-based Neal Communities, is something of a contrarian. He's not pulled in his horns as much as most private builders in Florida. Although he's down to 67 employees (from 150 at the peak of the market three years ago), Neal still has 14 developments and 38 model homes open for business.
     Neal picked up the last 45 lots in a community where Ryland built 120 homes, and opened two new models a week ago. He calls his version of the development Mandalay, where his base pricing runs from $226,950 to $299,900, for homes ranging from 2,267 to 3,236&n...Read More

Oct 29 2008 7:42AM | Permalink | Email this | Comments (1) |
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If you've ever vacationed in the Florida Panhandle in late spring or early fall, you know the allure of those sugary white sand beaches and stunning sunsets. But if you flew into one of the small airports scattered across West Florida, you probably  also experienced the frustration of trying to reach this place. That's about to change, and when it does, new opportunities will emerge for home builders in this region. The new Panama City-Bay County International Airport is under construction and four months ahead of schedule. It will open in the spring of 2010, and the world will discover the Panhandle.
     Florida's Panhandle has been a boom market for builders for a generation, driven mostly by second home demand of Southeasterners who drive to the beach from cities like Atlanta, Birmingham and Montgomery. Southerners head to th...Read More