Housing Giants - June 23, 2008 - (Page 28)

What makes an ‘a’ location? Bob eck explains. with a project, they can walk away without the obligations of ownership. Option fees that have already been paid, however, are forfeited. Location more vitaL than ever In any economic environment, the location of buildable lots is essential to successful development. Never has this been more critical, as the next housing recovery will likely be uneven with certain areas expected to bounce back much faster than others. Regions that have a fast-growing population and rising average incomes are poised for the quickest recovery. Within most regions, certain types of properties will take longer than others to rebound in value. “The biggest areas for defaults are the inner city and outer suburbs,” says John McIlwaine, senior fellow with the Urban Land Institute. Outlying suburban areas that have spawned tracts of so-called McMansions this decade have a few negatives to overcome, McIlwaine points out. The high cost of gasoline and growing pressure to reduce greenhouse gas emissions add up to a less favorable public view of the automobile culture, he says. Many people are fed up with driving long distances through heavy traffic. Unless outlying suburban properties are to fall for properties in some areas to become desirable. Builders that are able to convert excess land holdings into cash within the next couple of years and shore up their financial positions through cost cutting, could end up in advantageous positions. Some may be there already. “Plenty of builders are in a position to buy and hold; the problem is they are not finding what they want to buy at the right price,” Burns notes. Values on the best properties may still have room to fall. When they do, those who are financially sound will be ready to snap up bargains. An attractive alternative to buying property is to take out development options, says David Clinger, president of Denver-based consulting firm Land Planners. “Builders should only option a piece of ground, not buy it,” he says. Options allow builders to reserve the right to build on a property for a set period for a fee, and if they decide not to go ahead 28 HOUSING GIANTS.6.23.08 www.HOUSINGGIANTS.cOm http://www.uli.org/ http://www.uli.org/ http://www.dclinger.com/ http://www.housinggiants.com

Table of Contents Feed for the Digital Edition of Housing Giants - June 23, 2008

Housing Giants - June 23, 2008 Contents Viewpoint News and Moves Sell Workforce The Land Dilemma

Housing Giants - June 23, 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.