Larry Cheek

WASHINGTON – Construction of new homes jumped in May by the largest amount in three months, an encouraging sign that the nation's deep housing recession was beginning to bottom out.

The Commerce Department said Tuesday that construction of new homes and apartments jumped 17.2 percent last month to a seasonally adjusted annual rate of 532,000 units. That was better than the 500,000-unit pace that economists had expected and came after construction fell in April to a record low of 454,000 units.

In another encouraging sign, applications for building permits, seen as a good indicator of future activity, rose 4 percent in May to an annual rate of 518,000 units.

The better-than-expected rebound in construction was the latest sign that the prolonged slump in housing is coming to an end, which would be good news for the broader economy.

The current recession — the longest since the Great Depression — was triggered by a collapse in the housing market that led to soaring loan losses and a banking system crisis. A healthy home market is needed to support an economic recovery.

President Barack Obama is scheduled to unveil on Wednesday the administration's plan to overhaul financial regulation in an effort to crack down on the lending abuses that triggered the most severe upheaval in the nation's financial system in seven decades.

Even with the encouraging news, analysts don't expect a quick rebound in housing, since the economy is still shedding jobs and home prices are falling in many places, making people hesitant to commit to buying a new home.

Many economists say home construction likely will stop falling in the current quarter but any sustained rebound isn't expected to take hold until next spring. That's partly due to the huge overhang of unsold homes and a record wave of mortgage foreclosures dumping more unsold homes on the market.

With foreclosures and other distressed properties for sale at deep discounts, builders often can't compete. Rather than launching new developments, they are waiting for signs of a broader recovery. Many economists believe that home prices will keep falling until next spring and that sales won't start to show significant gains until the summer of 2010.

The 17.2 percent rise in housing construction for May still left activity 45.2 percent below where it was a year ago.

The jump reflected a 7.5 percent rise in construction of single-family homes, the third consecutive increase in this critical segment of the market.

Construction of multifamily units rose 61.7 percent in May to an annual rate of 131,000 units. This volatile part of the market plunged 49.4 percent in April.

Construction rose nationwide led by a 28.6 percent surge in the West. Construction rose 6.8 percent in the South and 11.1 percent in the Midwest. The Northeast had the smallest gain of 2 percent in May.

The National Association of Home Builders said Monday its housing market index slipped by one point in June, reflecting many builders' uncertainty about when their business prospects might improve. The Washington-based trade association said the index fell to 15. It was the first decline since January, when the index dropped to a record low of 8.

That report was "proof that the rise in U.S. mortgage rates lately is dampening activity," Jennifer Lee, an economist with BMO Capital Markets, wrote in a research note.

Earlier this month, major builders Toll Brothers Inc. and Hovnanian Enterprises Inc. reported smaller quarterly losses, rosier sales trends and more prospective buyers visiting model homes. Industry executives, however, say the recession and fear of job losses are keeping many would-be homebuyers on the fence.

 By MARTIN CRUTSINGER, AP Economics Writer Martin Crutsinger, Ap Economics Writer Tue Jun 16, 10:09 am ET

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Larry Cheek

Pending home sales rise 6.7 percent in April

WASHINGTON – Pending U.S. home sales in April posted the biggest monthly jump in nearly eight years, a sign that home sales are finally coming to life after a long and painful slump.

The National Association of Realtors says its seasonally adjusted index of sales contracts signed in April rose 6.7 percent to 90.3. Economists surveyed by Thomson Reuters expected the index would edge up to 85 from a reading of 84.6 in March. It was the biggest monthly jump since October 2001.

Typically there is a one- to two-month lag between a contract and a done deal, so the index is a barometer for future existing home sales. The index was 3.2 percent above last year's levels and has risen for three straight months after hitting a record low in January.

Tags: home sales | real estate

Clif Cheek

Buy or Build? Which is right for you?

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You've watched the market and have arrived at the conclusion that now is the time to buy a home. You now face the choice between buying a newly-constructed or an existing home. There are advantages and disadvantages to each option, so the decision may not be as easy as it sounds. No matter which way you go, you'll probably end up making a few tradeoffs. In the end, choose the type of home that makes the most sense for you, your lifestyle and your upcoming plans.

Although you are buying, you will sell someday

From an investment standpoint, it's best to think about the future along with the present. After all, you'll be the seller one day and you'll want to get the largest possible return on your investment.

That's a BIG closet

Although a return on investment is one of the goals of purchasing your new home, you also have to live in this home. Central air, comfortable living spaces, larger closets and more/bigger bathrooms are some of the amenities that are more common in newer homes and are points to consider when choosing your new home. Additionally, there are stricter building codes and significant advances in construction materials and techniques. These improvements result in safer and more energy-efficient homes. On the flip side, many older homes have a certain charm from the period during which they were built. This is not easily replicated in newer homes. Some older homes also sit on larger parcels of land than the lots common in most new subdivisions and developments. You may also have fun remodeling an older home to update it to your tastes.

New and Perfect are not always synonymous

Home maintenance comes with homeownership. There is no house that is maintenance or defect free. In fact, it's not uncommon to find at least one construction defect that must be addressed in a brand new house. So, in opting for a new home, make sure you understand the warranty and ask for a walkthrough to address the problems or defects.

What's under that "Hood"

The neighborhood should be an integral part of your decision. Think about your core values surrounding your home - school district, proximity to your workplace, and day-to-day convenience are common concerns for most people.

When can I move in?

If you purchase a home under construction or decide to build, be aware that builder delays or other holdups could prevent you from moving in on schedule. This may end up being no big deal, but if the timing's wrong, you may have to find a temporary solution while the setbacks are resolved. This may mean delaying closing on the sale of your current home and finding a place to rent, staying with friends or family or placing your belongings in storage.

Talk to someone who is an expert

When you're deciding between a newly built home and an existing home, decide based on your family's needs. A Realtor can help you sift through the options. Sit down with him and let him know what's important to you and your family. Whether you're interested in buying your first home, your next home, or just want to know more about home-ownership in general, I encourage you to use the internet to your advantage. 

Please visit us at www.Resort-Brokerage.com for valuable information on homes in the South Brunswick islands.

Clifton Cheek
2009-05-25 15:50:34  

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Josh McCall

With these six medals added to those won over the past six years the total awarded the winery comes to the 219 awards! Silver Coast Winery received bronze medals for its 2006 American Oak Chardonnay, 2005 Seyval Blanc and 2002 Merlot and silver medals for its Premium Oak Chardonnay, 2005 Reserve Merlot and 2004

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Baxter Cheek

The following article explains the American Recovery and Reinvestment Act of 2009.  In short, there is an $8,000 REFUNDABLE Tax Credit (or up to 10% of the purchase price of the home) for first time home buyers.  You can also be eligible even if you are not a first time home buyer.  Read more for the details but hurry becuase this tax credit is only avaliable from January 1 - December 1, 2009.  Click Refundable Tax Credit to read more. 

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Clif Cheek

We have all been anxiously watching this dismal real estate market wondering when and where we might see things reach their low and begin an anticipated upswing.  This article, written by the AP and featured on MSNBC gives us the sign of change we are looking for. 

Click: New Home Sales Data Show Encouraging Signs to view this news feed.  

Ocean Isle has remained fairly steady rather than following the drastic fluctuations of most markets due largely in part to the fact that Ocean Isle is mainly a second home beach.  With foreclosures on the rise of primary residences, our market has been just a faint thought for most home buyers.  However, this down turn has brought prices down and has, I believe, leveled our pricing structure on the island.  We are beginning to see a spike in interest levels and a rise in purchases.  I believe that this spring and summer are a buyer's best opportunity to purchase.  As the NY real estate mogul, Donald Trump, exclaimed in an interview recently with Larry King, "Well, this is a time for smart people. This is a time for entrepreneurial people. This is a great time for people like me...this is a great time to buy real estate."

Tags: ocean isle | bottom | real estate | market

Clif Cheek

Kurt Badenhausen, 03.25.09, 06:00 PM EST
Raleigh, N.C., and its fellow Tar Heel metros shine in our annual look at America's largest cities.

The economy shed 651,000 jobs in February and 4.4 million since the recession began in December 2007. Only a handful of metro areas have escaped falling employment over the past three months. Yet there are still some places out there that remain attractive to businesses.
Our 11th annual ranking of the Best Places for Business and Careers features clear winners in North Carolina and Colorado, home to a combined 10 of the 20 top metro areas.

Leading the way is Raleigh, N.C., which grabbed the top spot for a third straight year on the strength of strong job growth (both past and projected), low business costs and a highly educated workforce.

Employment is expected to fall during 2009 in Raleigh after jobs were added at a 4% annual clip the past five years. But the job picture is expected to brighten in 2010 and 2011, and the three-year projected annual employment gain is 1.4%. according to Moody's Economy.com, 15th best in the country.

Helping fuel Raleigh's strong economy is the Research Triangle Park, one of the oldest and largest science parks in North America. It is located between Raleigh and Durham and is home to 170 companies employing 42,000 people. Big employers include Biogen Idec, Cisco Systems and IBM.

"Raleigh is holding up better than any other place in North Carolina," says Matthew Martin, an economist at the Federal Reserve Bank of Richmond, Va. He cites the significant higher education presence and low manufacturing base in the area for Raleigh's steady economy.

FULL ARTICLE

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Clif Cheek

The only guarantee we have about marketing in today’s real estate climate is change. The market has changed. The buyer has changed. Will it ever change back and if so will we market the same way?  I am not sure and do not intend to make any grand projections other than the pendulum swings in both directions and God is not making any more dirt. So my assumption is like most cycles, these tough times will change. And marketing has and will continue to change with it.
So where does that actually leave us today?  It leaves us working harder and expecting less.
It leaves us reevaluating the products we develop and how we market them. We are back to the basics of asking ourselves what needs does the market have and how can we serve them? And how will we fill the need better than our competition? And, oh yeah, how does the internet come into play?

I always start with this guiding principal when determining a product’s position: Good, fast, cheap, you get two out of three.  Good being a quality product.  Fast being exceptional service. And cheap being a price leader. With a combination of any two you can create an effective value proposition.  With all three you are trying to be all things to all people and will ultimately serve no one.
In the past, resort real estate development was driven by a developer’s vision for a great piece of property and desire to create a grand lifestyle.  A place for people to love and cherish. A place they would bring their friends and family. And often a place envisioned and created without understanding if it filled a need in the market.  Not all, but many, ended up being monuments of opulence and irrational splendor that served a narrow market of extreme wealth and “ego ownership”.

In the current market there are buyers, believe it or not. These buyers are the ones who serve as the shepherds to the sheep that ultimately pull the trend back. These shepherds are driven by ideals and philosophies that are deeply rooted in their generational up bringing.  They are the boomers, but not the boomers we saw in droves signing reservations in tent city. These shepherds are conservative individuals who are prudent and pragmatic. They are far more calculating and much less impulsive. As much as they can afford the lavish, they are not going to be looking for their fourth McMansion. They are not ones that follow trends but are the ones that quietly create them. They are what we call the “know me” wealth, not the “show me “ wealth.  Unless you know these individuals personally, you would never pick them out of the crowd.  They are private. They are discerning. And they are wealthy. Very wealthy.

So what are they looking for?  Probably the same attributes they found when they bought their Toyota Avalon or F150. They want quality, reliability and value.  They are utilitarian. Yet they enjoy acceptable luxuries. They are natural researches and moved by trust and connections. When the time is right they will have been planning for years and will be armed with far more knowledge than you are. They will be looking for a quality product without empty promises or future guarantees.  This will lead them to established communities with reputable leadership. They will see right through your marketing façade and will cut to the chase about being in control of the process.
So how do we change our marketing strategy?

For starters, marketing starts with the product. Provide a product that meets a market need.  Do research, talk to your peers and listen to what the market tells you.  Then decide if you are good, fast or cheap.  My prediction is people will want a smaller, more modest product by a credible company and they will not want to wait for it. They will want a built product or resale inventory more than raw homesites and they have no desire to be first so throw the reservations out the window, urgency is gone. They just want to feel comfortable with their purchase and believe they own a solid product at a fair price, hence the Toyota Avalon. They are not looking for market approval and will buy what they want, when they want despite the negative media coverage.
Additionally, their habits have changed. They are going to want information with substance and if you do not have it they will move on.  And they will move on to the next web site as well.  Studies have shown that these buyers are no longer tech laggards and research their purchase decisions online.  Additionally, they will trust a stranger’s review online far more than your own paid marketing efforts (by 82% according to a 11/08 McCann Survey). Many of these buyers are starting their efforts with online search and your Web site alone is no longer enough.  You need a comprehensive strategy to distribute your content online with what we call Digital Presence.  A strategy that leverages all of your content as well as the content provided by others. You can’t stop others from mentioning you in blogs or posting wedding and hole-in-one videos on youtube so you better become a part of the off-site conversation as well.

So has the market changed marketing?  Absolutely.  And if you think the internet will not play a factor with your demographic then don’t change a thing and let me know how that works for you.

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Clif Cheek

North Carolina continues to be one of the fastest growing states in the nation.

Tags: population growth USA | north carolina

Clif Cheek

Ben Garvin for The New York Times
Jaime and Michael Proman put down 20 percent when they bought their home this fall in Lowry Hill in Minneapolis.

By RON LIEBER
Published: December 5, 2008
Five or 10 years from now, when the financial crisis has ended and housing prices are up smartly once more, we will look in the rearview mirror and realize that we missed a golden age for first-time home buyers.
Then, everyone who sat on their down payment savings accounts for a few years too long will kick themselves for not taking advantage of what may turn out to be the buying opportunity of a lifetime for those who can qualify for a mortgage.
Unfortunately, we do not know when this golden age will begin, because we will be able to identify a bottom to the housing market only with the benefit of hindsight. But as it does with the stock market, the moment will probably arrive when everyone is feeling the most pessimistic.
That moment is certainly getting closer. Housing prices have fallen drastically from their peak levels in many areas of the country. Rates on 30-year fixed-rate mortgages are already close to 5.5 percent, and this week there were suggestions that the federal government might try to drive them down to 4.5 percent, a truly incredible figure to be able to lock in for three decades.

Full Article

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