However, there is another, sneakier number lurking behind new home inventory - developed lot supply. In theory, as the supply of finished, empty homes begins to dwindle, we will logically need to begin breaking ground on the abundant developed lot supply.

Unfortunately, things aren’t exactly working out that way.

The numbers from the March 2010 Housing and Subdivision Analysis are in and of the 1,508 developments being tracked by MarketGraphics, 63.6% are inactive. No construction activity in the past four months. How exactly are we to eat up developed lot supply without construction activity? The hard truth is that the remaining 36.3% of developments are harboring ALL of the market’s activity.

Why?

Consumers don’t see the majority of developments as viable new home options due to improper marketing, an underdeveloped sense of community, shoddy maintenance and an overall desolate atmosphere.

It’s time to take stock of what your community is conveying.  Energy? Activity? Community? Or tumbling tumbleweeds?

The good news is that about half of inactive subdivisions are fixable with a little TLC, outreach and landscaping. It’s easier than you think, give Zanola Company a call for an immediate analysis.

New home development commercials are back on the airwaves. Radio seems to be the medium of choice with typical high-energy 30 second spots touting new prices in the low $100’s and tax-credit-over-soon urgency.

It’s a good thing.  The return of the ad budget means builder confidence is increasing and the deer-in-the-headlights syndrome has run its course.

That means it is time to shake off the hanging Tyvek, breathe in the (hopefully soon) spring air and get to work.  Scared? No worries, Zanola Company can help.  We’ve created a program to help clear the cobwebs and jump start your new, fresh outlook.

Introducing the Development Re- Energy Program. Read more below and call Zanola Company to request a personal evaluation.

“Today the neighborhoods east of Troost Avenue still bear the marks of disenfranchisement: abandoned homes, an unemployment rate that’s as high as 53 percent in some census tracts and gun violence that takes many young lives.

Tomorrow, this area could be a center of green jobs, retrofitted energy-efficient homes, a green transportation system and hopeful residents if Congressman Emmanuel Cleaver’s plans for using American Recovery and Reinvestment Act (ARRA) funding come to full fruition.

U.S. Rep. Cleaver, D-Missouri, has developed an ambitious plan for a “Green Impact Zone” to be established in a 150-block area east of Troost Avenue. He convinced the Kansas City Council to vote 13 to 0 to allocate millions of dollars of ARRA money and considerable city effort to this part of the city. And he’s rallied dozens of community organizations, residents and even businesses to work on making it happen. Now Cleaver’s office and the team from the community are submitting applications to numerous Recovery Act programs, supplementing work that’s already begun to bring a greener, healthier environment to this area and jobs to its residents.

At the heart of the plan for the Green Impact Zone is a massive home weatherization project that would put area residents to work conducting energy audits and weatherizing the 2,500 homes in the Zone neighborhoods.”

Source (http://www.greenforall.org/blog/what-a-recovery-fueled-201cgreen-impact-zone201d-can-do-for-a-troubled-city)

What can we learn from Kansas City’s program? How can we apply this to St. Louis’ drama filled Northside Project? Thoughts?

What do the numbers tell us and what is ahead?

1. We can expect modest increases on a month to month basis in 2010.

2. Homebuyers like buying in subdivisions where others are also buying.  An ever increasing percentage of starts are going to a smaller number of subdivisions.

3. Underperforming communities need to be re-energized with buyers.  Otherwise, these communities will be de-selected fast and will have no buyers.

Leasing empty rooms to seniors who need temporary care not only helps profit but it allows the community the opportunity to create loyal future residents.  Positive experiences in their temporary stay can hasten the move into the community and bring more referrals than the most seamless traditional ad campaign.

If you can get past the mental guilt factor associated with the idea of “kenneling” a loved one while touring Europe, it’s a brilliant idea.  One that St. Louis Independent and Assisted Living Developments should consider immediately, not only in times of trouble but 100% occupancy. Consider creating temporary stay units designed especially for this purpose.

The site has a new search technology call Bluescape, which “…allows consumers to give a ‘thumbs up’ or a ‘thumbs down’ to various images that are displayed – similar to how popular music sites learn users’ preferences based on how they rate different songs. After rating various photos, consumers can then submit a query and the BlueScape technology will identify homes that might be a fit. Developed to help consumers actively looking to purchase a home as well as those still in the dreaming phase, this visually driven approach to search is new to the real estate category.”

As a home buyer, you’re presented a series of lifestyle and real estate related photos, such as photos of mountains, pools, different styles of homes, etc. You rate each photo with a thumbs up or thumbs down and after you’ve rated enough photos, you can ask Bluescape to return your results.

The rating process is fun, but most of the photos were of beautiful landscapes, so I found myself very generous with the thumbs up button. Initially, I was confused as my search brought me photos of multi-million dollar homes in wine country. Not exactly my price range or current geography.

When I realized I could narrow by location and price range, I was given a collection of homes that are…nothing special.  Interestingly, however, many were located in the neighborhood I already live in.

It’s nice to see something new in the home buyer search experience. The goal for any broker or builder is to differentiate your real estate search from the millions of identical push pins on the web. While Bluescape needs some work before exiting the beta stage, it is memorable and new, which can speak volumes to a buyer.

Stutter Chart

Fannie, Freddie and the FHA: Almost 90% of mortgages are backed by government entities Fannie Mae and Freddie Mac or government agencies such as the Federal Housing Administration.  No one knows what lies ahead for Fannie and Freddie, but the White House is expected to offer recommendations for the future early this year. The FHA stands on shaky ground after big losses that may turn into another bailout. The FHA is anticipated to release information on how it will tighten up in 2010 within the next few weeks. Tighter loan standards for FHA, however, is a scary concept for builders and developers everywhere.

Loan modifications: The Obama administration’s modification program, launched in February 2009, has allowed 728,000 borrowers to sign up for trail modifications. However, only 5% have been able to move to permanent workouts. Borrowers who complete three reduced loan payments are eligible for a permanent modification that reduces their monthly payment for up to five years. These modification efforts, as tenuous as they may be, have aided in pushing back the supply of foreclosures in the market. While delinquent loans continue to pile up, it is safe to assume an increase in distressed and foreclosed properties to hit the market in 2010.

More loan resets: High-cost housing markets, such as the California coast, are still sitting on a hill of adjustable-rate mortgages that are set to increase in 2010.  Additionally, interest-only jumbo loans that allowed borrowers to defer higher payments for three, five or seven years will reset to higher payments. Unfortunately, some of these borrowers will not be able to manage the higher payments and may be upside down. This could cause additional pain for high end housing markets.

Tax credit and home sales: The $8,000 tax credit that bumped up sales and values in 2009 has been extended through the first half of the year. Some economists worry that we are adversely affecting future demand, while others expect modest gains to continue past the tax credit expiration date. Winter prices tend to decrease in any market, but Spring 2010 prices and sales will give us a better idea of what’s to come.

What factors are you watching in 2010?

Source: WSJ Developments

See the slides here: (Click here if the player doesn’t load for you.)

Date: Thursday, May 21, 2009
Time: 9 a.m.
Place: Branson City Hall, Council Chambers
RSVP: HBA office, 881-3711 or jennifer@springfieldhba.com
This is a complimentary presentation - RSVP is required.

www.springfieldhba.com