Builders and remodelers who work steadily on readjusting their business practices in response to the current economic downturn stand a good chance of surviving until better times arrive and trouncing the competition during the recovery, according to housing industry veterans appearing at the International Builders’ Show (IBS) in Orlando last month with the battle scars to prove they have weathered previous housing slumps.

“Today’s housing market is obviously not the same housing market that existed a couple of years ago, and that means you can’t afford to run your company the same way you did then,” said Michael Sivage, of Sivage Community Development in Albuquerque, N.M., who moderated the panel. The industry faces “another challenging year” following a “tough” 2007, he warned, and the burden is on builders to persuade consumers to consider the home-buying opportunities in today’s market despite the daily barrage of negative reports in the news media.

Sivage asked each builder to track where their businesses have gone since the start of the downturn in 2006 and discuss what they are doing to get through 2008 and prepare for better times ahead. Among the accounts shared with the convention audience:

Robert Camp, of Camp Corporation in Lakewood, Wash., said that his company closed sales on only 35 homes last year, compared to 125 in a good market; saw declining profit margins; and ran into cash-flow problems. This year, his objectives are to reduce the inventory and cut interest costs by 50%. To get out from under the interest burden, he is offering his customers the opportunity to rent houses in the existing inventory and then purchase them in two years, with rent set aside to help them qualify for a mortgage.

Camp has also resorted to “bare bones pricing” that has cut the selling price an average of $20,000 per unit by trimming construction costs, such as scaling back to a one-car garage. In a new subdivision going up on developed property owned by the company, on a pre-sale basis only, starter homes are being offered for just under $200,000, compared to $250,000 to $275,000 previously.

“The idea is to do something every day to help your company get through this downturn,” he said. For example, he has stopped accepting bids on projects. “We tell subcontractors what we can afford to pay, making sure they make a profit so we all will be in business in 2009.”

Camp is looking for 60 sales this year and has already made it a third of the way to his goal. “Don’t crawl into a hole thinking you can avoid all of this. It’s not going to go away,” he said. He also advised builders to take advantage of the resources available at their local home builders associations and “find people who can tell you how they got through things.”

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Tags: building, buyers, marketing, neighborhoods, where to buy by Aria
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By Shonda Novak | Thursday, February 28, 2008, 12:47 PM

Work is expected to start in about a month on the $120 million BartonPlace condominium development on Barton Springs Road, after the project won unanimous City Council approval for a zoning change today, the developers said.

The 270-unit project will replace the Shady Grove Trailer Park on Barton Springs, behind Austin Java.

The developers are Larry Warshaw and Perry Lorenz of Constructive Ventures Inc., builders of the The Pedernales, Saltillo Lofts, TwentyOne24, and Este condo projects in East Austin. Constructive Ventures is partnering in BartonPlace with Rick Engel, co-owner of Austin Java, Little Woodrow’s, Paggi House and Uncle Billy’s.

The development team has signed a private agreement with the Zilker Neighborhood Association that will forever limit the development of the portion of the property that fronts Barton Springs Road, to help preserve the local businesses that make up Austin’s popular “restaurant row.”

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Tags: austin, austin real estate, building, buyers, condos, downtown, economy, investing, marketing, money, neighborhoods, real estate, urban living by Aria
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By Sandra Fleishman
THE WASHINGTON POST
Sunday, February 24, 2008

WASHINGTON — Got a house to sell but worry about standing out from the competition?

Consider this: A research team at Cornell University has found that people will pay more for a house if its listing price does not end in a bunch of zeros.

In other words, the researchers say, you might make more money if you price your house at $325,425 rather than $326,000.

“It’s a psychological bias,” said Manoj Thomas, an assistant professor of marketing at Cornell’s Samuel Curtis Johnson Graduate School of Management. “A bias in judgment.”

The study concluded that because people are used to precise numbers for items that don’t cost much and to round numbers for large amounts, consumers generally and home buyers specifically tend to perceive that a price is smaller if there are digits at the end instead of zeros.

“It does seem ridiculous,” Thomas said. “But when you see a price, your response is not always based on deliberative reasoning.”

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Tags: austin, austin real estate, economy, marketing, real estate, sellers by Aria
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Austin Wins!

Today, the U.S. Conference of Mayors, Novelis Inc. and Keep America Beautiful, Inc. (KAB) announced the winners in the fourth annual Cans for Cash: City Recycling Challenge at the U.S. Conference of Mayors 76th Winter Meeting in Washington, D.C. To encourage recycling, the program challenges like-sized cities to compete against each other in aluminum can collection for monetary awards. During October 2007, more than 50 cities collected over 191 million used beverage cans.

“Through the City Recycling Challenge, we continue to actively promote and encourage growth in aluminum can recycling programs in communities,” said Kevin Greenawalt, President, Novelis North America. “In addition to its economic benefits, recycling reduces carbon emissions which helps combat climate change; so it is more important than ever to energize community recycling and build a sustainable environment. By recycling these aluminum cans, cities avoided more than 24,000 tonnes of greenhouse gas emissions, which is equivalent to taking more than 25,000 cars off the road for a year.”

“We are proud that our Cans for Cash Program helped jump-start existing programs and redirected many communities to focus on a common goal,” said Douglas H. Palmer, Trenton Mayor and President of The U.S. Conference of Mayors.

“The City Recycling Challenge is an excellent example of the type of sustainable initiatives we are encouraging through the U.S. Conference of Mayors’ 10-Point Plan. As outlined in the 10-Point Plan, cities are encouraged to implement programs to improve community energy efficiency and reduce community carbon emissions. The goals of the Recycling Challenge complement this and demonstrate how aluminum can recycling positively impacts the environment. Participating cities should be excited and proud that they contributed to the recycling of more than 4.5 million pounds of aluminum cans.”

he winners of the $5,000 awards for the most aluminum cans recycled are:

• Division One (population 250,000+) Milwaukee, WI* - 1,385,328 pounds, Mayor Tom Barrett
• Division Two (population 100,000-249,999) Fontana, CA* - 774,614 pounds, Mayor Mark Nuami
• Division Three (population 50,000-99,999) Des Plaines, IL - 1,120,660 pounds, Mayor Anthony Arredia
• Division Four (population below 50,000) Richmond, IN* - 43,381 pounds, Mayor Sally Hutton

* Note: 2006 Winners in Division Category

To help mayors engage their communities in recycling and raise awareness about its importance over the long term, cities submitted innovative education and marketing ideas for an additional $5,000 award. The cities being recognized for the most innovative campaigns are as follows:

• Division One: Austin, TX, Mayor Will Wynn
• Division Two: Irvine, CA, Mayor Beth Crom
• Division Three: Fargo, ND, Mayor Dennis Walaker
• Division Four: Poland OH, Mayor Christine Yash

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Tags: austin, environment, green, marketing, money by Aria
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MySpace pages, craigslist and blogs being used to lure buyers to housing developments

By Antoinette Martin
THE NEW YORK TIMES
Sunday, January 20, 2008

A condominium building under construction in Brooklyn has its own MySpace page. (”Scorpio” structure seeks “great people from the Metro area, and beyond, that want to live in a thriving community.”)

Some garden apartment rentals in New Jersey and a condo complex in Orange County, N.Y., have their own blogs.

In Stamford, Conn., the developer of a super-high-end condo tower is eschewing use of free classified-ad listings on craigslist.com to lure buyers, since “every mom-and-pop building these days is doing it.” But the company is putting big money into a virtual tour for its project Web site.

“A lot of people do all their home shopping online, start to finish,” said Kelly Marzullo of Core Marketing Group, which is using the Web to promote various Manhattan buildings and the Peninsula at City Place in Edgewater, N.J.

“People like to know everything about a building before they come in, or at least have a taste and a feel,” Marzullo said. Her Manhattan-based company does advertise properties on craigslist, building in links to Web pages that might include photographs, digital drawings, video, floor plans and the range of asking prices.  >>> Click for full article

Tags: marketing, sellers by Aria
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Major remodeling of rooms may get you less bang for your buck

By By Amy Hoak
MARKETWATCH
Sunday, January 13, 2008

CHICAGO — Homeowners interested in getting the biggest bang for their remodeling buck might want to shelve the idea of full-blown room remodeling and opt for more practical replacement projects that reduce home-maintenance needs, increase energy efficiency or improve curb appeal, according to a recent report.

Remodeling magazine’s annual Cost vs. Value Report found late last year that seven out of the top 11 projects that paid off the most at resale were replacement projects, said Sal Alfano, editorial director for the magazine. That includes window and siding replacements.

Also, minor remodeling is paying off more than expansive room improvements, according to the 2007 report. Construction costs for common remodeling projects were compared against the share of those costs recovered at resale, with projects broken down into “midrange” and “upscale” categories.

National, regional and city data can be viewed at the magazine’s Web site, www.costvsvalue.com.  >>> Click for full article

Tags: marketing, money, sellers, staging by Aria
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