Abandoned Subdivisions + Q1 2009 Building Permits

From California come reports that houses are being torn down in those lonely and abandoned subdivisions.   A Texas-based bank said that increased foreclosure activity and tighter mortgage financing makes it necessary for these actions.   Banks don’t want the foreclosed houses that have been so badly destroyed by vandals that have even further reduced their values.  Apparently it’s cheaper for the banks to bulldoze them rather than finish them or sell them at drastically reduced prices.  Here’s the video showing the tear down.

Other home builders have weighed in as well saying that the economy is placing heavy burdens on buyers, lenders and home builders. The news the other evening said there are 250 abandoned subdivisions nation-wide and 9,000 unfinished houses just sitting.  And, on a recent TV station, it was mentioned that we have 3.5 million excess houses in inventory and that an average year should have 1.5 million houses.  Those high numbers are further depressing our real estate market.

However, here in Portland comes a different story about an abandoned subdivision.  A platted 27 acre parcel that was going to have 65 homes built in that subdivision has now been turned into a park for everyone to enjoy.  Funny, you don’t hear those kinds of stories on the evening news.

According to the Department of Housing and Urban Development, I prepared the following that shows how many single-family building permits were issued by county/cities around the Portland metro area for Q 1 2008 vs. 2009:

Building Permits By City	2008 – Q1	2009 – Q1
Unincorporated Clackamas County	152	38
Lake Oswego	11	9
West Linn	7	6
Wilsonville	7	2
Unincorporated Multnomah County	2	2
Portland	184	90
Beaverton	32	24
Hillsboro	39	23
Sherwood	5	1
Tualatin	17	1
Tigard	19	7
Unincorporated Washington County	151	79
Source:  HUD

The City of Portland’s Planning Department states that as a sign of the construction slump, applicants have delayed requesting building permits. By the end of 2008, overall building permit applications were down by a third from the year before. Residential permits declined even further, down 64 percent. Applications for land-use reviews were down 36 percent.

According to a recent report from Credit Suisse:

“Difficult appraisals and competition from foreclosures are the obstacles to new home sales. Builders continue to mention their concern about converting contracts into closings due to appraisals that often come in below the purchase price as appraisers use extreme conservatism and use foreclosures as comps. In addition, foreclosures and short sales remain the toughest competition, with prices well below those of new homes.”

© Copyright 2008-2009 Betty Jung.  All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.

(For more national and local real estate information, go to my website at www.bettyjung.com)

Market Update: Multi-Family Q 1 2009 + April 2009 Stats

A few days ago I wrote a post on the multi-family segment of real estate in our marketplace and vacancy rates. As our residential market numbers indicate with high inventory, the multi-family/apartment inventory remains high as well not only in Portland, but throughout the U.S.  The greatest number of sales for Q1 2009 occurred in NE Portland and for April 2009 that area along with SE Portland seemed to have the most sales, although certainly not in large numbers.  Once again, the sales for  multi-family investments, as well as residential sales, are happening in the closer-in neighborhoods of Portland.

Here is my multi-family Q1 2009 and April 2009 stats update for Portland and the surrounding areas from RMLS™.

© Copyright 2008-2009 Betty Jung.  All Rights Reserved. Use of this article, photos and images without permission is a violation of federal copyright laws.

(For more national and local real estate information, go to my website at www.bettyjung.com).