Housing Giants - February 1, 2009 - (Page 8) FEATURE David LeBoeuf and Steve Bartholomew have been home-building partners in Austin, Texas-based Main Street Homes since 1993, but now these erstwhile hunting buddies find themselves following politics more closely than ever. As entry-level builders selling primarily to first-time home buyers, they will have the eyes of the nation this year, as they test whatever economic stimulus programs the Obama administration and Congress come up with this winter to thaw the country’s frozen housing markets. That’s because entry-level buyers are the key to jump-starting home sales at every price level. They don’t have houses to sell. If young renters start buying their first homes again, the huge inventories of unsold new and existing homes will begin to drop and prices of existing homes will stabilize. The lowest level of ownership housing is where the pump must be primed to free the machinery of the entire marketplace. There’s one more reason Bartholomew and LeBoeuf are point men for housing recovery: The Texas 08 02.01.09 HOUSING GIANTS www.HousingGiants.com markets where they build — Austin, San Antonio and College Station — are not as crippled as those in California, Arizona and Florida. Texas was the last place housing sales stopped. Inventories of unsold homes are nowhere near the staggering levels in California and Florida. And LeBoeuf and Bartholomew say they still see price appreciation in their markets. “Our average sale is about $133,000, and we don’t sell anything for $200,000,” says Steve Bartholomew, “yet houses we sold a few years ago for $160,000 are now selling for $200,000. That’s what happens when you build a good house and the value of the location goes up. Our markets are still viable.” Austin is the state capital, with a government-based economy. San Antonio has a military-centered economy and bases are growing. “There are a lot of young people in Austin and San Antonio who are ready for home ownership,” says David LeBoeuf, “but they are holding back — waiting. They turn on the TV and see the flood of negative national economic news, especially about housing. Naturally, they think this can’t be a good time to buy.” Bartholomew says when Main Street’s sales slowed in 2008, he did some research to find out what was happening to the people who were not buying houses. “We learned there’s a lot of doubling up going on,” he says. “It won’t take much more than confidence to get buyers back into the market.” THe STATS Main Street Homes 2008 Giant 400 rank: 152 2007 CLOSINGS: Type……….SFD Units……….1,008 2007 ReveNUeS: Housing……$133.1 million What Builders Need There is one missing piece to the puzzle, the partners say, and that’s where Congress can help. By the time this issue reaches you, it may already be in place because the new Congress is pledged to work at breakneck speed. “Our buyers need down payment assistance,” says Bartholomew. “When DPA went away last fall, it took a huge segment of first-time buyers out of the market.” The Main Street partners are convinced their markets will come back faster than others. “What we need is a zero-down FHA loan,” CURReNT OpeRATIONS: Austin (10 locations), San Antonio (8 locations), Bryan/College Station (1 location) STRATeGy: Main Street seeks a slightly higher value niche than most entry builders by specifying materials and finishes buyers associate with more expensive homes—while still keeping its average price well below $150,000 by reducing square footage. The partners also prefer to develop their own communities (very unusual for a Texas entry builder) to assure quality of neighborhoods. Bartholomew says. “Probably 70 percent of our business is in FHA mortgages. We do some VA business in San Antonio, and there are still a http://www.mainstreethomes.com http://www.mainstreethomes.com http://www.probuilder.com/Giant400 http://www.housinggiants.com
Table of Contents Feed for the Digital Edition of Housing Giants - February 1, 2009 Housing Giants - February 1, 2009 Contents Viewpoint News & Moves Process Feature Housing Giants - February 1, 2009 Housing Giants - February 1, 2009 - Housing Giants - February 1, 2009 (Page Cover1) Housing Giants - February 1, 2009 - Contents (Page 2) Housing Giants - February 1, 2009 - Viewpoint (Page 3) Housing Giants - February 1, 2009 - News & Moves (Page 4) Housing Giants - February 1, 2009 - News & Moves (Page 5) Housing Giants - February 1, 2009 - Process (Page 6) Housing Giants - February 1, 2009 - Feature (Page 7) Housing Giants - February 1, 2009 - Feature (Page 8) Housing Giants - February 1, 2009 - Feature (Page 9) Housing Giants - February 1, 2009 - Feature (Page 10) Housing Giants - February 1, 2009 - Feature (Page 11) Housing Giants - February 1, 2009 - Feature (Page 12) Housing Giants - February 1, 2009 - Feature (Page 13) Housing Giants - February 1, 2009 - Feature (Page 14)
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