HOW DO YOU PREDICT HOUSING SALES FOR 2011?...I See A Major Trend In Custom "New Builds"

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Real Estate Agent with Douglas Elliman Real Estate 30HA0800896

HOW DO YOU PREDICT HOUSING SALES FOR 2011???... I See A Major Trend In Custom "New Builds"

According to the latest news, modest increases in new home sales gives one the hope that this is the new beginning that we have been waiting for! National news is sounding very grim for the housing market going forward, but I am getting the calls that I have been waiting for from builders. Now, there are not enough "tear-downs" to satisfy the needs! The builders who took the chance in '09 have houses sold or in contract right now.

One new construction on a relatively modest street has just sold here in Southampton Village and that has started a run on the smaller houses on that street! I will have a new listing after I sell the smaller house at the end of the street---another "New Build" that is expected to sell for just under $5Mil. 

A  CUSTOM "NEW BUILD" LIVING ROOM/GREAT ROOM

THIS CUSTOM HOME JUST SOLD FOR TOP DOLLAR IN SOUTHAMPTON VILLAGE, NY

According to the data that I have been able to glean from our records, the only houses that are selling fairly close to the full asking prices are the new builds that were built during the WORST of the housing downturn. These houses were also built in prime areas and are near the ocean and the heart of the village. Out of the 4 houses that I have in contract right now, 2 of them are brand new!THE GREAT ROOM IS ESSENTIAL!

THE NEW HOUSES ALL SEEM TO HAVE THE ALL-IMPORTANT GREAT ROOM, which incorporates an open gourmet kitchen with a breakfast area, a sitting area or casual living room.  The details include high, coiffured ceilings, hardwood floors, a fireplace and is always wired for televisions and computers.

Custom details also become crucial to the buyer; they want their imprint on the home...the needs have changed significantly since the recession hit.

 ALMOST ALL NEW HOUSES INCLUDE ROOM TO ACCOMMODATE EXTENDED FAMILY MEMBERS---a guest cottage is crucial or at the very least, a pool house is added for the extra room. A finished basement is another amenity that is becoming important for a new build. The "escape" of a playroom, game room and even a wine cellar is big plus in these new houses. Some New Builds sport private theaters as well!

THE OPEN KITCHENLife changed after 2001 and more young families live here year round while the"bread-winner" spends the week in New York City and returns to the Hamptons for the weekends. This changes many of the services offered year-round here in the Hamptons--Many people no longer find the off-season months depressing. There is year-round activity going on even in January and February, the notoriously gloomy time of year. The summers have never been busier!

 

 OPEN LIVING AREAS DOMINATE THE "NEW BUILD"--a formal dining room is always included but the house itself is reflective of a very casual life style--"Gathering Rooms" are the way people like to live today and the builders are more than happy to meet these needs.

The construction itself is of the highest quality--no more "Spec House" influence. The most successful New Home builder is always aware of high quality and new high-tech materials that make the house a good solid investment. Some of the newer materials allow for the "sway" of a building in the wind--this is over and above the new regulations that require wind protection with re-enforcement of all roof lines and free standing structures like pool houses or gazebos.

NEW CONSTRUCTION IS VERY POPULAR

MOST NEW HOUSES ARE BEING BUILT IN A PRIME PART OF SOUTHAMPTON VILLAGE. Near the ocean beaches and Gin Lane, and very near the shops, restaurants and museums, the Little Plains area is the most desirable spot right now.....even more popular with new home buyers than the world famous  "Estate Section" of Southampton Village.

The reason seems clear; the location is the best in terms of walking to everything, including the train.

The Wall Street Journal ran an article a few weeks back regarding the "Walk to everything" mentality.

 

 See the article here;  http://online.wsj.com/article/SB10001424052748703964104575335164136600430.html?mod=djemRealEstate_t

However, the other crucial factor in the popularity of this area is the PRICE! Compared to the estate section, a new home buyer can own a custom built house with all the "bells and whistles" for 1/2 of what they would pay in the estate area. Even though the lots are smaller, the added benefit of the proximity to the heart of the village and all IT has to offer makes the Little Plains Area a new destination for new home buyers.NEW BUILDS ABOUND

The average "New Build" buyer has the money to pay for all the details that make a house  stand out in the area. Southampton Village has had very strict architectural restrictions....in the past, the storied meetings of the ARB (Architectural Review Board)included fist fights, arguments between homeowners and several encounters that required a call up of the police to halt a near riot!---That was during the height of the market when emotions ran high and the owners of the small 1950's bungalows were on their soapboxes to try to halt the newer homes or "Mac Mansions" as they called them. "We are losing the charm of the village to these huge, new houses"! All that has changed now as the former outspoken neighbors watch thier homes lose equity and some have even HAD to sell their homes just to live. Sadly, the builders are more than happy to help out...Thus, the changes are established now and the normal resistance to the "New Builds" has faded into the past.

Meanwhile, the most obvious of all the intrusive, huge homes were already built in the estate section and on the ocean in the 1990s and the early 2000's...these homes were the sprawling result of years and years of excess and the large lots accomodated the large structures with no complaints....many of these houses now sit, waiting to be listed for sale and for the market to turn back in time to the early 2000's and that is not likely to happen soon!

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Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Jonathan: Sounds like it is really rough there! I wish I could send some of it your way---just hold on though, because I believe that when things do turn around, it will be strong!! Meanwhile, if I may suggest something, it would be to keep a positive thought! Keep on working it until it comes back full bore---do not give up, because real estate will come back! there is always a need for houses!

Jan 01, 2011 03:11 PM #20
Rainmaker
1,079,379
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

Paula, we have seen a come back in the luxury waterfront market this year as well. And there have been a few tear downs in the last couple of years on the waterfront of Fleming Island. Otherwise, our area is not old enough for tear downs. This post should be very helpful to Southampton buyers.

Jan 01, 2011 03:14 PM #21
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Lane: Deal hunters here too--they do not give up! Slowly but surely I think things will get back to some normalcy. We have seen that people are starting to spend again and now they need to see confidence in the housing market in order for it to come back...the unemployment figures are still bad but that is not where the home buyer is right now---there is money out there and once the confidence returns, buying will start up again....there is always a need for housing---depends on price if you ask me and prices are way down everywhere! (so are interest rates for the moment!)

Jan 01, 2011 03:16 PM #22
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Frank: This got featured in "neighborhood posts" so I think it will get good exposure for the Hamtpons....if you read the other  comments here too, there are several agents from resort areas who are in agreement---also in Washington DC and the Virginias. I have a feeling that that is where the money is for investments and that is why I see it as a trend. So, open your mind up to the idea that this could be a start for something good--and then let's talk, OK? :) Happy New Year to you and yours!

Jan 01, 2011 03:22 PM #23
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Bryan Robertson
Los Altos, CA

I've started to see more activity with both end-consumer custom home buyer/builders and speculators in Los Altos, Los Altos Hills and a handful of the better areas nearby.  There are still a lot of projects that are just too big for people to jump on (3 or more houses at a time) but the single home projects are taking off.

The result is a significant increase in high-end sales for the area and some solid demand, enough to keep the days on market to double-digits in many cases.  Pricing is still sensitive and buyers are looking for good deals but the market is coming back around.

Jan 01, 2011 03:34 PM #24
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Bryan: I am so happy to hear the good news about your market! Pockets--it's all about pockets right now---the sooner we all realize that the better off we will be. "You can't push the harvest" is an old Druid saying that comes to mind...it does apply here, does it not? I am also seeing that the builders who came in like gangbusters and built 2-3-4 houses like they were king and the peons would just have to buy them, are now dragging behind. It is the very special house with the very specific custom touches that are selling---even better if the buyer is engaged in the process!!!

Jan 01, 2011 03:43 PM #25
Rainer
494,808
Dörte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton & rest of Maryland

Dear Paula,

It seems the taste for mega mansions has changed to more functional spaces with character. Younger buyers do not want to be house poor and prefer a great location rather than huge square footage.

Jan 01, 2011 03:57 PM #26
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Dorte: I think you are correct--the new buyer out there is a whole different animal..and they have money but they don't want to splurge or to appear too flamboyant in their spending!

Jan 01, 2011 04:01 PM #27
Rainer
27,015
Michael Nugent
Prudential Califoirnia Realty - Corona, CA
Sells Corona, Eastvale & Riverside

Awesome!

Thanks!

Michael Nugent Corona-SoCal

Jan 01, 2011 05:26 PM #28
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Michael: Glad you like it!! Thanks for reading the post and here's to a Happy, Healthy and prosperous 2011!!!

Jan 01, 2011 10:34 PM #29
Rainmaker
1,827,067
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Paula great post. I have 5-6 leads that have come in the last 4 months for build jobs in a development where we haven't built in a couple years ! All would be smaller homes than 2007 !!!

Jan 02, 2011 12:24 AM #30
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Michael: It is beginning to look like pockets all over the nation are picking up on this trend---could be a leading indicator for the rest of the country, slowly but surely!!! :)

Jan 02, 2011 02:22 AM #31
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Missy Caulk
Missy Caulk TEAM - Ann Arbor, MI
Savvy Realtor - Ann Arbor Real Estate

Someday I hope to visit there. It looks amazing. I agree more and more buyers only want the Great room concept. The formal living room...originally the parlor are just not being used anymore.

Waisted space. But, they still want that formal dining room, for grandma's china etc...

Jan 02, 2011 02:31 AM #32
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Missy: You are so right---Grandma may even be going to live there with them!!! The other big trend here in this second home market, is the families are buying houses that accommodate all members of the family---extended members as well. The new house is being designed with that in mind here at least.

How are things in Michigan? I know your particular area is different than the rest of the state but I have family in Flint, Traverse City and Charlevoiux and they tell me things have been really bad. Here's to the New Year! Enjoy,  and good luck in 2011!

Jan 02, 2011 02:43 AM #33
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Erica: I think sometimes that the lower priced markets are the place to be when things are good in real estate; I hear numbers of transactions that are amazing! But here, there are some years when I do one big deal and that is it! The last 2 years 2008-2009 were like that and I was really nervous about how I was going to make it---don't forget, we have thousands of agents here and they are all drinking from the same cup! Very stressful market here unless you are a top agent...Anyway, happy New Year to you and yours!

Jan 02, 2011 05:22 AM #35
Rainmaker
224,121
Laurie Mindnich
Centennial, CO

Paula, I love the open concept- it's been widely used in western states for a while, but a bit less so here (hugely competitive open land states tend to have innovative builder floorplans). The only substitute is a historical (original but updated legitimately) home ( I love 1920's)- you have so many gorgeous homes there- but the better builders seem to be blending the old characteristics with new, which is an amazing combination, and not usually found in western areas with any kind of authenticity.

Jan 02, 2011 08:25 AM #36
Ambassador
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Tammie White, Broker
Franklin Homes Realty LLC - Franklin, TN
Franklin TN Homes for Sale

Paula, you have done an excellent job here of explaining the potential for buyers and sellers. Not only is this very informative, I also like the look. I can see that this blog is going to bring you lots of business.

Jan 02, 2011 09:07 AM #37
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Laurie: You are so right--one of our late, local architects, Norman Jaffe, went to Wyoming and Colorado to design contemporary houses in the late 80's and he left a huge imprint on architecture with the vaulted ceiling, large soaring living areas with stone and wood combined like no one else did at the time--lots of Japanese influence. The style is now a little dated but we have some of his best works right here in Southampton....The influence now is to add the same features in more traditonal homes and buyers love it! Most people don't look at it as a Jaffe influence but I see it clearly...I knew the man and his work is respected as much as the famed architect, Stanford White who was so well known and important to the early 20th century Estate Section summer cottages here.

Tammie: Thank you so much! The look is quite something---a trend in itself, with 3 stories to work with and in many cases a second residence or pool house on the property! I certainly hope you are right about the business it may bring! :) Happy New Year to you and yours!

Jan 02, 2011 09:42 AM #38
Rainmaker
291,279
Kate Bourland
Marketing with Kate - Redding, CA
Onlilne Marketing Mobile Marketing

Interesting.  It's as if the country has turned into two very distinct markets.  The high end and the low end.  That is some beautiful architecture.  

Jan 04, 2011 03:02 PM #39
Rainmaker
494,549
Paula Hathaway, REALTOR, LBA
Douglas Elliman Real Estate - Southampton, NY
...The Most Informed Agent In The Hamptons!

Kate: It does look that way---however, I see that there several other areas that would be considered middle income that have new builds starting to happen...we will see won't we?

Jan 05, 2011 04:18 AM #40
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Paula Hathaway, REALTOR, LBA

...The Most Informed Agent In The Hamptons!
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