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NEW CONSTRUCTION – Nationwide & West Coast
The National Association of Home Builders reports that in October, nationwide housing production fell 10.6 percent to a seasonally adjusted annual rate of 529,000 units in October as builders awaited word on whether an important home buyer incentive would be extended. Single-family housing starts declined 6.8 percent in October to a seasonally adjusted annual rate of 476,000 units, the slowest pace since May of this year with the West declining by 8.5 percent.
Permit issuance, which can be an indicator of future building activity, fell 4 percent overall in October to a seasonally adjusted annual rate of 552,000 units, due primarily to a double-digit drop-off on the multifamily side. While single-family permits held virtually flat at 451,000 units, multifamily permits were down nearly 18 percent to 101,000 units. Regionally, permit activity was mixed, with the West posting a 6.7 percent decline. There was also a recent story indicating that lumber prices have increased although housing construction is still down near World War II levels. 
The U.S. Census Bureau also released their construction spending data for October 2009, revealing that the real estate sector dropped 14.4% from October 2008. The residential real estate sector was up 4% which had speculators rallying but spending dropped a staggering 23% from October 2008.
New construction inventory has been falling due to slower than average but consistent salespace coupled with a lag in new spec homes coming on the market. Although sales are trending up, builders are still struggling to close sales. The Census Bureau reports that new U.S. home sales rose to an annual rate of 430,000 in October, up from a revised September rate of 405,000. That’s a 6.2 percent jump, but the increase isn’t statistically significant.
Another report indicates (released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development) that the median sale price of new homes was $212,200 in October with an estimated 229,000 units available at the end of that month, reflecting a 6.7 month inventory.
IHS Global Insight economist Patrick Newport gives these highlights:
- Inventories fell for the 30th straight month and hit their lowest level since May 1971. That signals that builders at some point will need to boost housing starts again.
- While the October jump wasn’t statistically significant, the trends show that new home sales are improving slowly.
- The tax credit didn’t drive any sales bump because the deals had to close by Nov. 30 and these won’t.
- Selling a new home has never been harder. The median time it takes to sell a new home rose to 13.5 months. The highest reading ever. Builders are still struggling, despite the pickup in sales and the tax credits. Calculated Risk has some nice charts. (See below.)
From Calculated Risk blog
NEW CONSTRUCTION – Oregon
According to a recent housing report from Norris Beggs & Simpson as reported by OregonLive, the unsold inventory of speculative new homes has fallen this year from 1,200 units in January to 679 in September. Washington County has 37 percent of unsold spec homes; Clark County is second with 26 percent, then Clackamas County with 22 percent and Multnomah County with 15 percent. Outlying suburban markets accounted for two-thirds of new spec inventory in the third quarter 2009. New construction sales are down 72% in the Portland area from the peak of the real estate cycle.
NEW CONSTRUCTION – Portland
My regular readers know I’ve been writing relentlessly about smaller houses. From everything I read, and there was an article in the Oregonian recently that mirrored everything I’ve been saying, I believe the public does want the smaller sq. ft. and that builders will hopefully start accommodating that segment of the market.
As I was writing this post I remembered something that happened after the mid-80s recession ended. We didn’t have any new houses to sell. There was no new construction anywhere in the marketplace for buyers to purchase. It took a long time before the builders put new construction inventory back into our market. Will that happen again this go around? I personally don’t think so, but that could happen. With inventory of new houses drying up, builders not building, little to no construction money available, we could be looking at zero new construction as in the mid-80s. I’ve also stated that I believe the large subdivisions are on the way out and that more and more builders, as has already been the case, will be building on in-fill lots or on a build-to-suit only basis for a buyer for some time until new construction gets back on its feet. Sounds like we’re going back to the 80s.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No 
Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
Chown Hardware is offering a Free Remodeling Seminar in their Portland showroom:
Portland Location
333 NW 16th Ave
Portland, OR 97208
(503) 243-6500
Aging in Place Remodeling Seminar
Saturday, December 5th – 10:00 – 11:00
Thursday, December 10th – 10:00 – 11:00
Learn about planning your remodel for future or current special needs. Speakers for this seminar will be Kaye Powell, Chown Hardware VP and Randi Reed, Neil Kelly CMKBD Certified.
I also read a blog about decorating a small space. Inasmuch as the trend is or will be smaller, I thought it would be a good idea to share some of those decorating tips:
Below is a list of 10 things NOT TO DO when designing for a small space. They are written by Libby Langdon. S Interior Design added additional commentary where relevant. (Shown in italics)
The top 10 biggest mistakes people make in small spaces are:
Leaving your walls white: White walls won’t technically make your space larger and they lack personality. Spice up your space, have a little fun, and paint some color on your walls!
A great example of this is powder rooms. Chose a bold, rich color and wrap the room painting all walls and the ceiling.
Using large-scale furniture: Oversized pieces can hog square footage, and using better-proportioned furniture will help you to create a more functional and comfortable living space
It is best to use multi- functional furniture in small spaces such as a upholstered storage ottoman as a coffee table.
Lack of light: Not lighting your space effectively makes it look smaller, and if you can’t see an area in your room, it’s as if it’s not there! Capitalizing on natural light, while also bringing in artificial light is imperative.
Use light to highlight architectural details and artwork.
Using short shelving and cabinetry: Using full-scale shelves and cabinets that go all of the way up to the ceiling will visually draw the eye upward, making the ceiling seem higher, and your space feel larger.
Apply this same principal to your drapery. Bring it full height, ceiling to floor regardless of the actual window height.
Keeping clutter: Holding onto too much stuff and not throwing away clutter can make even a large space feel small, so when in doubt, throw it out!
I echo that sentiment ‘when in doubt, throw it out!” If you cannot bear to get rid of something, put it in storage and rotate bringing it into the room trading it out for another item, not adding it on.
Using small-scale accessories: Large lamps, artwork, candles, vases, and accessories will create the appearance of a larger space with more height. No wimpy lamps!
Think big impact with one or two accessory items versus a lot of small items that get lost among one another.
Not using mirrors: Mirrors reflect light, whether it’s daylight or lamplight, and they visually make your space appear and feel larger by adding depth and dimension to your interior.
When possible make sure the mirror reflects something pleasing to the eye such as a floral arrangement, or colorful piece of artwork.
Not capitalizing on your wall space: Think vertically and get your walls working for you! Mount shelving or storage systems up on your walls to display collections, and store additional items so that you don’t waste precious table space. This will also help to focus your items in one spot, so that your space feels more organized.
No one has ever complained that they have too much storage space regardless of room size . You can cover shelving with decorative fabric treatments if you want to add color and interest
Using all wood furniture: It makes a room feel clunky and bottom heavy; by mixing in glass-topped tables with wood pieces, you give your room a lighter, airier, and more open feel.
I adhere to this even in larger rooms. Mixing materials will always give you a better end result.
Using small area rugs: A small area rug can look like a postage stamp and make your room feel cramped; using a large rug creates an extended visual line and gives the illusion of more square footage.
By:
Libby Langdon, founder of Libby Interiors and interior design expert addresses these very issues on HGTV’s celebrated show Small Space, Big Style where all of the featured spaces measure in at less than 1,000 square feet. Edited by Suzanne Lasky, S Interior Design
If you’re a Boomer, there’s a website that serves age 50 and older in all areas related to life planning, volunteering, learning, active living, community and enjoyment. Find out about the latest news and resources to support adults in transition and discover, design and engage your future – Life By Design NW.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
As you know if you’ve been reading my blog, I have been on my “platform” so to speak against large homes and about the need and 
desires of the boomers wanting to stay in their communities as they age.
After I published my critical post about the City, the Lake Oswego Review had a story about how its officials are rethinking the future development here in Lake Oswego and had this to say:
“Before the current recession, the trend in Lake Oswego was to replace older bungalows and ranch homes with large, expensive houses. In addition to Lake Oswego’s attractive parks, schools and other amenities, high land prices and easy access to credit contributed to the tear down trend locally. The small, relatively affordable homes that were removed for upscale housing were never replaced. What was once entry-level housing quickly disappeared, and middle-income families and young adults are now essentially shut out of the Lake Oswego market. This, of course, creates a problem for the Lake Oswego’s public schools, which are experiencing an overall decline in the local school age population; the school district is now seeking tuition-paying students from outside the district, which is not a sustainable solution. The trend is also a problem for empty nesters and other long-time residents who wish to stay in Lake Oswego.”
The First Addition neighborhood is one of the areas referred to in the above. The small cottages were torn down in favor of the larger McMansions much to the disgust and anger of residents living there. Now, that quaint and award-winning community is stuck with those larger homes crowding out the remaining smaller houses.
I also read recently on the Heritage Council’s website that many of this town’s architectural landmarks have been torn down, lost or have disappeared. Since I started my Lake Oswego Living.A Photo Blog, I’ve been researching landmarks and photos I want to take. There’s a lot of history here in town that can never be captured. It’s a shame that everything in favor of and to benefit its citizens is always done after the fact and not with forethought like saving those historic sites. We’ve got to do more. This is a great community and it can get even better.
You sometimes hear critics call this quaint town “Lake Ego”. Frankly, I love living here and I for one don’t want to leave.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Portland
The Home Builders Association in Portland reported recently that sales dropped in August over July and overall sales for the first eight
months of the year were down 15 percent over the same time period in 2008. The higher-end markets tend to be lagging as well with Lake Oswego-West Linn being the “dog of the market right now”, said the group. The builder’s group also says we’ve bottomed out for homes at $350,000 or less, but the higher you go in the market, the worse the conditions are. For the upper price range, time will tell.
There is a lot of new homebuilding activity at the top of the hill in Oregon City: new excavation, framing and other positive signs of movement. As reported in one of my posts, builders are now keeping busy building on in-fill lots around the area. I also have heard rumors that METRO towards the end of the year is not planning on expanding the urban growth boundary which means builders will be scrambling for lots when the market improves and/or continuing to build on those in-fill lots.
The Homebuilders Association also says they have seen the inventory of lots decline. Existing (lot) sales are continuing at a good pace and there haven’t been many new lot listings come on the market for sale. Some lots are being tansferred back to banks from builders, and the amount of spec homes on the market has dropped noticeably from 1900 unsold spec homes in April of 2008 to 1,079 in mid September. The builders group says that it is a good sign and that the region is working its way through some of its existing inventory. Maybe it took this Great Recession for these big builders to finally figure it all out.
UPDATE ON LOCAL BUILDERS
Legend Homes: No more furnaces in the garage. Optional rain barrels and raised gardens. Solar panels, standard, on every roof. Legend Homes is upping the green ante with its new EarthSmart collection of homes in its Tigard community – Edgewater. The first Earth-Smart home models are under construction now and will be completed by the end of the year. They will have smaller footprints – 1,400 to 2,000 sq. ft. from $296,000 to $336,000.
Here’s a story about Roger Pollock (Buena Vista Custom Homes) building in Happy Valley from Oregon.live.com. I remember visiting Mr. Pollock’s house one year when it was on the Christmas Tour of Homes. The 19,000 sq. ft. house with its circular drive, on the water has all the resort amenities you can imagine. Now he says he will go smaller and cheaper.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
As many of my regular readers know, I’ve been on a personal crusade against builders constructing McMansions. I’ve written numerous posts about smaller, affordable
yet quality homes that are sorely lacking in our marketplace. My personal opinion is that the large homes will become obsolete, we’ll have a glut of inventory on the market once the baby boomers downsize and that younger buyers won’t want them. Couples are having children later and smaller families, boomers don’t want that sq. ft. or number of bedrooms, and due to the economy the move-up buyers are smaller in number. Further, people just can’t afford them nor will they want to after this recession.
Do builders not know that 77+ million baby boomers will need smaller, affordable houses let alone the first-time buyers? Since the 1980s I’ve been complaining about this and now comes this article in the Builder magazine urging builders to build smaller and affordable homes. Here is what builders need to know: build smaller, more affordable homes, even as the economy recovers, because that’s what people will be most likely buy.
Hammered by “heavy employment losses,” not to mention pay cuts and furloughs, “estimates of consumer incomes are running much lower” than previously projected, according to Nigel Gault, chief U.S. economist for IHS Global Insight.
“The new revised figures have taken some $200 billion out of labor compensation estimates—that’s almost 4 percent off consumer income,” Gault explained last week during a Web presentation on the likely recovery for the U.S. economy. “It leaves consumers in worse shape than thought in terms of spending.”
For that reason, smart builders will want to concentrate on lower-priced homes that these economically-battered buyers can actually afford. “Wages and incomes are extremely constrained,” Gault said about employment situation. Unemployment, for example, is expected to reach a peak of 10% next year. That’s because employment growth—i.e., companies adding or replacing jobs—tends to lag behind other economic indicators as wary firms remain hesitant about hiring people.
Building less pricey homes also should offer some protection against additional home value drops. “We are not convinced yet that home prices have completely bottomed out,” Gault said. “… We suspect there’s probably a little further [for home prices] to go on the downside because foreclosure rates are still very heavy.”
Alison Rice is senior editor, online, at BUILDER magazine.
In my recent “Boomers Impact Future of Housing” post I noted how important boomers would be to housing trends in the future. Now there’s an article that says boomers will be the ones to bring us out of this recession. It’s time builders started listening.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Last Sunday I watched the news on CBS. There was a report about Tumbleweed Homes. In fact, I had read an article in one of my many magazines a while ago about that company and have been meaning to research them.
Photo from CBS Website
Tumbleweed Homes builds “tiny” houses no bigger than a little more than 100 sq. ft. There’s another company I read about recently that also builds them. They aren’t called houses because they are so small but are called vehicles instead. Tumbleweed is traveling the U.S. promoting their product and may be coming to your town soon.
While many Americans, either due to the economy or personal situations, are wanting to downsize, this may be taking it to an extreme. The average sq. ft. throughout the U.S. is 2,500 sq. ft. Many baby boomers are also rethinking their lifestyle and living quarters. Tumbleweed’s advertisement boasts that when you buy one of their houses, you have no mortgage or utility payments. It might sound appealing to many people and their question and mine is “Do good things really come in small packages” or are they taking downsizing too far?
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
I’ve written many posts about seniors and boomers wanting smaller homes. Over this past year I even got on my “soapbox” to reiterate 
my views. Now comes a report from Portland State University that says small may just be a fad and temporary trend, and says people will start buying the “McMansions” once again after this financial meltdown and recession are over.
In another post, I read a contradictory report saying just the opposite from RIS Media.
“So, here we are in the future we once imagined. No robot vacuuming the floor, our SUVs are bigger than a 1960 Lincoln Continental Mark V, and our homes have earned the title, “McMansions” by swelling from an average of 950 square feet to about 2,400. And, in many moderate wage communities, homes of 6,000 to 7,000 square feet are common.
Why? Well, because we wanted them, for one thing. They were the ultimate status symbol and maybe always will be. If a man’s home is his castle, it darn well better feel like one.
As much as a castle-sized home is a status symbol, it is also a symbol of wretched excess and the general contempt of its owner for those of us being crushed under the boot-heels of his enormous carbon footprint. Free market economy or not, no one is entitled to such a gluttonous amount of the planet’s limited resources.
Most of the homes built in the last 20 years are bigger than they really need to be. They consume too many resources to create the materials, the building process has too much negative impact on the surrounding environment, they require too much energy to occupy and they do not guarantee happiness.”
I tend to agree, naturally, with the RIS Media story because I’ve been holding open houses for most of my 34 years selling real estate on Sundays. This past weekend – Memorial Day weekend – I once again held an open house at one of my listings. And, as in the past, I had buyers looking to downsize, wanting the master bedroom on the main level or single level with quality construction and smaller in Lake Oswego. Maybe I’m wrong, and maybe it’s the trend for now because of this recession. However, I have seen buyers wanting that for the entire time I’ve been selling real estate with no good options from builders here in Portland. Time will tell….
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
A survey recently released by AARP states that:
- One in four baby boom generation households (26%) expects to move from their current home in the future, with the majority looking for a single-level home that is more comfortable or convenient, according to a survey prepared for AARP.
- Echoing past surveys, most boomers (79%) say they would like to stay in their current home for as long as possible. Some – less than 10% — said they would like to stay in their current home but don’t think they will be able to do so.
- Many of those who expect to move said they will be looking for a better house, a better climate or a home that is closer to family and friends. More than half of those boomers (age 45-64) planning to move expect to look for a home that’s all on one level (59%). About half said they will look for a newer home (50%) or a smaller home (49%).
- Older boomers are significantly more likely than younger boomers to move into a single level home (68% vs. 54% of those planning to move), but age is not the only factor that affects expectations. Boomer men are more likely than women to believe they will move into a newer home (61% vs. 42%) or move into a home in a warmer or better climate (41% vs. 25%). Boomer women are more likely than men to think they will move into a smaller home (54% vs. 41%).
Ever since I started this blog, I’ve been saying how the Baby Boomers want it, and how trends lean towards it - urban living. I’ve written many posts about “ghostburbs”, walkable neighborhoods etc. since May 2008. In my stat reports as well, it has become obvious, like many other recessions, that the closer-in neighborhoods have been holding their values more than the suburbs here in Portland. Good market or bad, that always seems to hold true. Here’s a recent Yahoo!® article that talks about all of that as well.
Also, Portland State University’s Center for Real Estate - 4th Quarter 2008 report states that the younger generation and the Boomers want to live close to cities:
“The two largest cohorts making housing decisions are the Baby Boomers and their children, the Echo Boomers. In increasing numbers, aging Baby Boomers have been choosing to vacate the suburbs to live in a more diverse life in the cities. And the Echo Boomers, who grew up in the suburbs, are increasingly choosing to migrate to the cities. If you look at the data that we have been charting, you will see that the close-in locations have preserved their housing values much better than the suburbs which have suffered enormous losses. People are voting with their feet and their wallets. Developers and planners need to shift their attention to itensifying and improving existing growth corridors and growth centers”.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
What? Mansionization, what’s that? There’s a new “buzz” word…mansionization. Now from Los Angeles, comes the Mansionization Ordinance. 
The Los Angeles City Council voted unanimously to enact the Baseline Mansionization Ordinance:
“…the maximum residential floor area contained in all buildings and accessory buildings shall not exceed 25 percent of the lot area, except that when the lot is 20,000 square feet or greater, then the residential floor area shall not exceed 20 percent of the lot area or 5,000 square feet, whichever is greater.”
Will that work in Portland? Is all my griping finally paying off? I’d like to think I had a hand in it. If you’ve been following my blog, you know I’ve been on a “crusade” of sorts to get builders to build smaller quality, affordable houses. Actually, I’ve been trying to get builders to do that since the 1980s when I represented 5 builders. Now, there’s a recent article on RIS Media stating that builders are getting it, finally. The economy and Baby Boomers are now forcing builders to rethink new construction.
At the 2009 International Builders’ Show in January builders were talking “small” as housing prices tumble and the economy continues to weaken. I think it’s ironic that during our housing bubble, the houses got bigger and bigger. Now that the economy and people’s wallets are shrinking, so too are house sizes. Whoever thought a McMansion would suit the masses anyway?
Some other consumer housing trends builders will be incorporating into these newer, smaller houses are:
- Fewer luxuries. Consumers say they need fewer luxuries. Twenty percent viewed upgraded landscaping, upgraded finishes such as granite counter tops, and luxurious master suites as less important. High ceilings in main living areas were less important to 35%. There are also fewer fireplaces in new homes: While 62% of new homes completed in 1991 had at least one fireplace in it, 51% had a fireplace in 2007.
- Green elements. Ninety percent they want energy-efficient heating and cooling systems and 31% plan to have geo-thermal heat. There has also been increased interest in home gardens, with more people wanting to know where their food is grown. The green theme touches everything in the home, from the food we consume, our health concerns, green building and even our furnishings.
- Getting organized. With smaller spaces, organization systems are continuing their popularity. More entryways are being outfitted for storage, and homeowners want more functional use of wall space. Sixty-nine percent want a no-space-wasted design and ample storage will take on more importance.
- Practical appliances. Although sales of appliances have been down, freezer sales have been up. The reason: More people are shopping for bargains and freezing what they won’t use right away. Appliance sales have taken a hit … except the freezer. Which is really all about going back to basics, a very practical kind of living.
According to the National Association of Home Builders, 88% of builders surveyed in January said they are building or planning to build a larger share of smaller homes. Eighty-nine percent said they’re planning on building more lower-priced models.
As homes get smaller, homeowners are looking to economize the space they have. There is more interest in “Wii-sized spaces”, family rooms that are flexible enough to accommodate a variety of activities from video games to fitness systems. Outdoor spaces aren’t being wasted either, and outdoor kitchens and entertaining areas continue to rise in popularity.
Source: MarketWatch.com Inc. & Curbed L.A.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Housing needs change throughout our lives. Here are five things to consider if you have reached the point where a move might be the best strategy for you:
- Are you over housed? Are you rattling around in your “empty nest”, paying more than you want for taxes, utilities and maintenance?
- Do you need equity from your home? Sometimes a move is needed to convert equity into cash and income to be secure for the years to come.
- Does your home style match your physical ability? Are there too many steps or steps down to rooms you don’t use in your current home?
- Has the neighborhood changed? If friends, relatives, neighbors and your doctors have moved away, maybe it’s time to consider moving as well.
- Would a move improve your lifestyle? If extensive traveling appeals to you, you may want to relocate to a more economical lower-maintenance home. You may want to be more conveniently located near activities such as golf, bridge clubs, walking trails or walkable neighborhoods.
I truly believe the larger homes will become less desirable. With Baby Boomers reaching large numbers, I think the 4++ bedroom homes will slowly become those “unsold” listings we always refer to. In many places of our country, the only alternative to a scaled down life-style is a condo or townhouse. You know from reading my past posts I have been urging builders to build smaller, affordable, quality homes. I was surprised, as I indicated the other day, to read on the National Association of Home Builders’ website that the association is urging builders to start building smaller homes geared towards Baby Boomers.
In Lake Oswego about 10 years ago, Polygon Homes built what they referred to as “patio homes” in Lake Oswego off Carman Drive. Each home has its own albeit small lot but the legal description refers to the houses as being condominiums since the entire neighborhood share the common spaces. That subdivision was sold out quickly and there hasn’t been anything else like it built since then. They were smaller, affordable, quality homes close to amenities, bus and shopping. Granted, however, many of them were still two-story houses.
There was a college course I still remember that explained how Colonial American towns were defined and developed. They were all formed around schools, railroads, churches, town centers, etc. Main St.’s, the downtown core of small town America, are disappearing from our landscape. Instead of the 1960s suburban sprawl, we once again want those same amenities and conveniences close to our neighborhoods.
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
A Wall Street Journal article said no one can assess the outlook for housing without considering the effects of the 77+ million Baby Boomers. Some housing experts believe boomers will be much less likely than their parents to settle for sun and golf in retirement; they may prefer urban settings with lots of cultural life or to live closer to friends and family. That could mean higher demand and increased prices for housing in urban neighborhoods.
Dowell Myers, a professor of urban planning and demography at the University of Southern California, warns the retirement of boomers over the next two decades is likely to depress house prices in many areas. As boomers relocate to retirement homes, there will be a lot more sellers than buyers in parts of the country. It’s going to really mess up the housing market. He predicts that this “generational correction” will be larger and longer-lasting than the current housing slump.
To get a sense of the effects of aging boomers, Mr. Myers looked at the number of Americans 65 and over per 1,000 working-age people. He sees that number increasing to 318,000 in year 2020, 411,000 in 2030, up from 238,000 in 2000. Many people over 65 buy homes but as they get older become more likely to sell than buy. People 75 to 79 are more than three times as likely to be sellers than buyers. In some areas, younger people will be happy to buy (and probably renovate) those boomer nests. The problem will be in places where lots of older people are selling and fewer young people are settling down. He says the effects will be strongest in the “coldest, most congested and most expensive states rather than the high-growth states of the South or West.” Among the states where Mr. Myers sees downward pressure on prices within the next decade: Connecticut, Pennsylvania, New York and Massachusetts.
On the opposite side of the coin, there was a report that said the size of houses has grown by 50% and that our current recession would do nothing to change the McMansions or 4+ bedroom houses. Consumers still want larger homes despite our hard economic times. However. the one thing this article failed to consider unlike the Wall Street Journal article, in my opinion, is how the 77+ million Baby Boomers will impact the future of housing.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Retail reports for the holidays were bleak. Records show it was the worst Christmas for retailers since 1969. Reports say that malls are facing bankruptcy or loss of businesses. Some of those have said malls may become future homes to new housing. Here’s a Housing Wire article where malls have already become housing with more predicted.
CNBC says commercial real estate will be taking a big hit in 2009. The Oregonian Front Porch blog stated:
Mall vacancies approach 10-year high: Bloomberg reports that vacancies at U.S. malls and shopping centers approached 10-year highs in the fourth quarter, and are set to rise further as declining retail sales put more stores out of business. Regional mall vacancies rose to 7.1 percent last quarter from 6.6 percent in the third quarter. It was the highest vacancy rate since Reis began tracking regional malls in 2000, as well as the largest quarter-to-quarter jump in vacancies, according to New York-based Reis. It hasn’t helped that Circuit City Stores Inc., Linens ‘n Things Inc. and Sharper Image Corp., all filed for bankruptcy protection in 2008. “So much of consumer spending depends on the wealth effect,” said Victor Calanog, director of research at Reis. “Unfortunately, all three conditions are still in flux. Even when they stabilize we often observe anywhere from a 12- to 24- month lag until commercial retail properties begin benefiting.” (Via Calculated Risk).
Another recent article in the Oregonian stated in part “General Growth Properties Inc. the country’s second-largest mall owner, last month hired a commercial real estate firm to put prominent retail centers in Boston, New York and Baltimore up for sale in a desperate attempt to shore up its finances. The Chicago-based company is saddled with huge amounts of debt it took on during the market’s boom when it aggressively bought assets. General Growth owns more than 20 shopping malls, including Pioneer Place in Portland, Clackamas Town Center in Happy Valley, Rogue Valley Mall in Medford, Salem Center in Salem and the Gateway Mall in Springfield.”
Several reports say that indoor shopping malls are becoming white elephants and “destination” type centers such as Bridgeport Village, Streets of Tanasbourne (Oregon), and Victoria Gardens (California) will be the type of shopping “hot” spots in the future.
What will become, if anything, of Clackamas Town Center which is currently facing financial problems? I’m not suggesting it will become housing, but no one knows what the future has “in store”. In Oregon with our rain, I can’t imagine an indoor shopping mall becoming obsolete. Yet, could senior housing be built at Washington Square? The above got me thinking about areas that would make great senior or “boomer” type housing locations. This is certainly not to suggest I know anything more than the above.
Good idea or not? Will the era of shopping centers and strip malls on every corner become a fad from the past and time of excess? Will that phrase “Shop Until You Drop” become game-show trivia?
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
It was a perfect “10″ day in Portland a few days ago with Mt. Hood and Mt. St. Helens out in all their glory and the sun shining ever so brightly. I had enjoyed my drive to our local Ikea store while listening to those Christmas songs that I had complained about in an earlier post that came on the air early November. But, I get it now. I understand why the stations start so early because on this beautiful day I was singing along at the top of my lungs with Gene Autry’s ”Rudolph, the Red Nosed Reindeer”, next came “Jingle Bell Rock”, followed by “Feliz Navidad”. Thank goodness, “Silent Night” came on right after that because who knows what I would have done, by then I was really in the Christmas “spirit”. No, it’s not snowing here in Portland yet, but I thought I’d add it to my blog, since ”tis the season” and I’m now officially in the Christmas spirit! Besides, how cool is that.
Right before the turn to the Ikea store near the airport, coming across the freeway, was a huge (and I mean huge) flock of small black birds, blocking the sun from shining in my eyes and all the traffic came to a halt to let those birds cross. What an amazing sight!
When I arrived at the Ikea store, the parking lot was almost empty so I got a parking space practically at the front door. Inasmuch as I was returning a rug I had purchased, I’m glad the entrance doors were close by. Since it had been such a great day and everything was working in my favor, I thought I’d take my time to really look around without the crowds.
I’ve been to that store many times and maybe because of the great day I was having, I noticed something I hadn’t seen before. Perhaps it’s because I’ve been writing so many posts about small cottages for seniors, new homes for $50,000, or wishing smaller houses would be built here in Portland. Did you know that Ikea has 3 model floor plans that have 235 sq. ft., 375 sq. ft. and 590 sq. ft.? I’ve walked through them before looking at the furnishings not realizing they were emphasizing small spaces. In the interior design classes I’ve taken, we drew floor plans for small spaces similar to these.
Inasmuch as houses are getting smaller, and condos are already small (I sold one recently with 500 sq. ft.) those three model floor plans show how the space feels and how to furnish, decorate and configure a small space. Each of those plans has a kitchen, eating area, bath, living room and bedroom plus lots of storage space. The 590 sq. ft. space actually has a second bedroom or den! Granted the sq. ft. is extremely small, but Ikea shows it can be done and very nicely as well. There are lots of ideas on how to use built-ins, furniture, accessories, storage. etc.
I asked for a copy of the model floor plans to include with this post, but they didn’t have them. Next time you’re near or in an Ikea, check out the three model floor plans. I was surprised at how nice they actually are.
On the way home I saw a crescent moon. It doesn’t take much to make me happy and it was definitely worth the trip to the store!
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
California may be a trendsetter yet again. Recently I read an article where KB Homes (the builder that Martha Stewart partners with) has started building smaller, single-level homes. 
It sounds as if it is partly because of the current state of our economy. I hope other builders, however, will pick up on this as well.
I’ve read that the Street of Dreams 2009 will be held in Lake Oswego, Oregon. A past Street that was held in Lake Oswego was one of HBA’s most popular. In 2009, I hear those builders who showcase their homes will be scaling back in size and price.
In case you missed my posts: “Baby Boomers Aging in Their Homes“, “New Homes for $50,000?” and “New Cottages for Seniors“, you certainly know how I feel about smaller, quality affordable, single-level homes.
Also in an article about Randy Sebastian (Renaissance Homes), I read where he has plans to build a “boomer” type subdivision in Wilsonville. However, because of his bankruptcy, time will only tell if that ever gets completed. This could be a start! Hopefully I can get off my soapbox soon. Here’s what the article said:
Home Sizes Shrink to Lure Buyers
Home builders are reducing the size and options available to appeal to buyers with less money to spend and who are facing a harder time getting financing.
Los Angeles-based KB Homes had shrunk its homes from 3,400 square feet, selling for $450,000, to 2,400 square feet selling for $300,000 to appeal to buyers. Now, it’s shrinking its homes yet again–1,230 square feet priced at about $200,000
Other builders, including Warmington Homes and John Laing Homes, have taken similar approaches.
We’re getting back to more the way things were historically, kind of undoing the excesses, not just from a price perspective but home size and (fewer amenities), says Nishu Sood, a Deutsche Bank analyst.
The new KB Homes aren’t just smaller, they are more efficiently designed, says Steve Ruffner, president of KB Home’s Southern California Coastal Division.
“You could have a three-bedroom, 2,500 square-foot single-story home and all you had was wide hallways and bigger rooms. It wasn’t really giving [buyers] the utility,” Ruffner says.
Source: The Associated Press, Alex Veiga
As I’ve stated in another post, typically when the economy is bad, people from the outlying suburbs want to move closer to town. Also, what we typically see during times like this is that the larger homes don’t sell and people have a tendency to want to purchase the smaller houses. Builders may be sitting with their new construction inventory of McMansions for a while yet, or at least while the economy is in a downward trend.
When I went to file my income taxes in October, my accountant told me he knows of many people that have said to him that as soon as the economy picks up they will be unloading their big houses, big fancy cars and excesses and they are just waiting on the side-lines for their financial situations to improve. They all felt it just wasn’t worth the expense any longer. Will we have a glut of homes with larger sq. ft. next year that just won’t sell – one of my predictions for 2009!
ALL ABOUT…..Portland.Oregon.Real Estate, is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 Unported License. © Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws. Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Royalty Free Photo Purchased from iStockphoto
If you read my post about “New Breed of Builders: Cottages for Seniors” you know my desire for builders to construct smaller homes for seniors (and others) who wish to downsize. Also, if you read that post, you saw there are builders in Washington currently building small homes. I had a video showcasing the homes and builders in that post.
The other evening on ABC News had a story entitled “Scaling Down the House”, about downsizing where two owners had homes built under 800 sq. ft. and another around 500 sq. ft. One paid $50,000 and the other paid only $10,000 to have the home built (without the cost of land). Both owners live in Portland and it showed the builder who built those smaller homes. Unfortunately, he said he can’t keep up with the demand that has been created. Granted these may be extreme and, others might want slightly larger homes than those, but isn’t it possible to build them? YES!
I’ve been challenging builders for years to do the same thing. So, if one builder can do it why can’t others? I understand land costs are high. However, prices are coming down, there’s available inventory of land/lots. Lending is tight but there is a real need for this type of home and builder in our local marketplace. There must be a need like this in other areas as well. Please no more McMansions. Also, I think in the future, the larger homes will become harder to resell. Now with our financial crisis, perhaps more people will realize we all need to get rid of ”stuff”. Less is more.
The news report said this is a new trend. It’s been something I’ve been complaining about since the 1980s. Please let’s have more builders step up to the plate and build smaller homes. I know builders want to maximize their investment and make the most money, but there’s a real need for the smaller, affordable, senior-friendly home and for those who don’t want or need lots of sq. ft. or a high mortgage. I’ll get off my soap-box when I see it happening.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Royalty Free Photo from Dreamstime
In a study by MetLife -”The Boomers are Ready to Launch” (CLICK HERE) the 77 million Americans born between 1946-1964 known as the “Baby Boomers” feel they have done a good job contributing to their communities and to society and are more conventional in middle-age than they were in their youth.
So what are some facts uncovered by MetLife? Here’s a sampling:
- Thirty-one percent plan to apply for Social Security when they turn 62 and 32% say they will wait until age 66 or beyond when they can receive full benefits.
- Sixty-eight percent say they have employee or retiree health insurance.
- Forty-seven percent are covered by a defined benefit plan, 50% have a 401K, 50% have an IRA.
- Thirty-eight percent have stocks and 38% have mutual funds.
- Eighty-five percent own their own home.
- The average value of their homes is $297,900.
- Sixteen percent would consider a reverse mortgage primarily to take care of their own long-term care needs and costs; 74% aware that they are eligible at age 62 to apply for a federally backed reverse mortgage.
- Twenty-five percent say they plan to move to another area for retirement
- Twenty-two percent have long-term care insurance.
The “Boomer Elites”, those as defined by a national market research firm Focalyst, says they have an annual household pre-tax income of $150,000, are overwhelmingly married (92%) and live in a residence valued at nearly double that of the “average” Boomer.
Boomers represent 26% of the population nationwide and 30.2% of the population in Oregon (U.S. Census Bureau).
Well-known Americans born in 1946 are: President George W. Bush, First Lady Laura Bush, President Bill Clinton, Cher, Diane Keaton, Dolly Parton, Linda Ronstadt, Liza Minnelli, Reggie Jackson, Sally Field, Sylvester Stallone, Donald Trump, Suzanne Somers, Susan Sarandon, Jimmy Buffett, presidential candidate Fred Thompson and the late Gilda Radner.
While substantially satisfied with their lives, most Boomers are optimistically making plans for an even better future.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Finally, some builders are paying attention to the needs of seniors and “boomers”. CLICK HERE for the Yahoo® Finance article where builders are now starting to build smaller cottage homes for seniors or those wanting to “down size”. Now, if only the builders in Portland, Oregon would stop building those “McMansions”. Seniors will be the largest segment of the population and yet builders fail to recognize that many “boomers” and seniors don’t want big houses.
These builders in the article think small in a way that is practically un-American. They build tract houses that are half the size of the average U.S. home but do, unfortunately, cost a lot more per square foot. What is surprising is how quickly they sell them. Builders are building their fortunes with buyers willing to pay more for less. Customers say they prefer taking up less room and using less energy.
There is a cottage builder in Shoreline, Washington building houses from 800-1600 sq. ft. The homes are pricey and geared to those that want to down-size and want eco-friendly houses. The houses are also what seniors and boomers are wanting. The Certified-Aging-In-Place Specialists (CAPS) has a laundry list of what seniors are looking for. CLICK HERE to view. Here’s yet another link showing how housing has changed over the last 70 years.
This past Thursday I was part of a 13-house progressive Realtors’® tour in Lake Oswego. The couples that came through were all empty-nesters or retirees, wanting to down-size. Some would love a higher-end, one-level home without stairs. Again, they are hard to find in our area. They’re looking for smaller, senior-friendly homes but there are very few. When a quality one-level home does come on the market in Lake Oswego, it usually sells before it even hits our RMLS™ (MLS). Wouldn’t it be great to have a builder in our local area have the vision and “guts” to go against the grain and build the kind of houses mentioned above here in Portland?
***UPDATE 10/26/08*** I had a link to a video at MarketWatch but see is no longer working. I am trying to find out if the web address has changed to re-link it. However, in the meantime, I also found this information that might prove helpful and this as well on the communities discussed above.
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.
ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.
(For more local and national real estate information, go to www.bettyjung.com).
Photo from Microsoft Office
Recently I held a listing of mine open that’s in my own neighborhood in Lake Oswego. Lots of the neighbors came by to visit. Every one of them said they want to stay in their homes as they age.
“The only thing that comes to us without effort is old age”. – Gloria Pitzer
Unfortunately, all the houses are 2-story homes. No master bedrooms on the main floor and for the most part, no full bath on the main either. We all love our area, its location and driving proximity to amenities. Some of the neighbors have started remodeling their dining rooms to make master bedroom suites and eliminating living rooms entirely making the floor plan look more like a great room concept.
For years, I have been whining to home builders to build homes for us “baby boomers”. OK I admit it, I am a “boomer”! Boomers are the largest segment of the population – 70+ million of us, and builders have not accommodated our needs. In recent years, builders have built homes with master bedrooms on the main floor, but the sq. ft. of these homes is more house than seniors need or want.
This evening I read a report about Canadian baby boomers. Same problem. It said that Canadian cities aren’t ready to meet the “challenges” of their aging population either, that 25% of their citizens will be seniors by the year 2036, and the Canadian seniors prefer to “age in place” as well. The article also said our cities and towns need to become more “senior” friendly. I couldn’t agree more!
© Copyright 2008-2009 Betty Jung. All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.ALL ABOUT…..Portland.Oregon.Real Estate by Betty Jung is licensed under a Creative Commons Attribution 3.0 United States License.
Based on a Blog at WordPress.(For more local and national real estate information, go to www.bettyjung.com).
Betty Jung
Builders + Boomers = Disconnect & Lack of Housing for Seniors/Boomers in Lake Oswego
October 27, 2009 in Commentary, New Construction Stats, Builders, Lots, Seniors, Boomers, Small Houses | Tags: All About Portland Oregon Real Estate, Betty Jung, www bettyjung.com | Leave a comment
Builders + Boomers = Disconnect
I’ve written many posts about Baby Boomers, inasmuch as I am one. In holding open houses here in Lake Oswego, I meet many Baby Boomers as well. All
along I’ve been against the McMansions and have stated so. In addition, however, I have also given kudos where due to the builders who are finally getting on board and building smaller houses.
Now comes word, that everything in my blog posts is “happening” in new construction. Gone is the glitz and glam of yesterday. Gone is the popularity for the McMansions and now the 1,900 sq. ft. house is the most desired sq. ft. by Boomers. It’s the first-time home buyers, the Baby Boomers, empty-nesters, singles, and seniors that all want and need the smaller, quality-built affordable houses. All those add up to a large percentage of home buyers.
In a recent story, along with a MetLife report which I’ve written about,
Guess I’ll stay in the house I have as long as I can do the stairs, as it’s exactly that sq. footage. The article goes on to say there’s been a Builder-Boomer disconnect – I’ve only been saying that forever!
Lake Oswego + Boomers = Disconnect
In last week’s Lake Oswego Review there was an article about the City now once again concerned about the affordability of houses for its seniors and Baby Boomers. Lake Oswego has always been a high-end market with a lack of easy transportation and affordable housing.
Particularly, the West End of Lake Oswego where I live there is no easy transportation with only one limited bus route and service and you have to cross a busy highway. Situated next to I-5 and Kruse Way, the West End would be a logical place to add light-rail along those two corridors. The Kruse Woods Financial District is located at this West End, with office workers not given any choice but to drive. Certainly not an amenity the City can shout about nor can Boomers and Seniors use on a frequent basis. There are no stores or shopping within walking distance from my house other than perhaps Trader Joe’s which is about a mile away. So much for the Walk Score for its West End – the “forgotten child” of Lake Oswego’s City officials.
Everything seems to be geared towards the affluent area of First Addition and near the Lake instead. There is no easy parking at the Library and in fact I’ve had my car hit in its parking lot. Yet the Lake Oswego residents are hesitant to transfer those facilities to its West End Building. The Lake Grove Post Office is severely lacking, and it would be a great addition to the West End Building not to mention the Booktique which is currently in Mercantile Village. We bought the building, so now let’s use it. Are there any Planners on staff at Lake Oswego with the vision to make this an even better place to live?
(For more local and national real estate information, go to www.bettyjung.com).