Archive for July, 2009

Storm Water Run Off

Thursday, July 30th, 2009
“Never waste a good crisis.”
Ever heard that statement before?
It seem like the the mantra has gone well beyond “porkula” bill pass as a “stimulus” bill in Washington and has silently slithered into the streets of main street America. In Virginia, this mantra has gone all the way to the governor’s office. The issue, storm water run off. The topic sounds about as fun as watching paint dry. Plus, we all want good clean water. What can be so bad with increasing the regulation on the big evil capitalist developers? We all want to preserve the Chesapeake Bay. Save the blue crab! Save the Oysters! Why is the proposal so bad? There are 2 main reasons: The cost vs. benefit and the governor of Virginia plans on dealing with this proposal as a slight change in regulation and forgo the legislative process. As developers are currently developing land, there are erosion control currently in place that adequately control the land form extensive negative impact. The proposed legislation would add substantially to the cost of development. With the fees attributed to the program and the additional cost to be borne by the developer, the cost of housing and development will go up. This small detail of cost is not addressed anywhere in the proposal. The only issue of cost addressed is the ability to fund the program through the fees levied against the project.The Virgina Department of Planning and Budgeting states in it’s report: “the cost likely exceed the benefits for one or more proposed changes” “uncertainties exist over the long term cost and effectiveness of many storm water control practices”;”the total cost to the state of implementing additional storm water control practices to meet the proposed regulatory changes could not be estimate at this time” “Virginia residents will also likely pay for the higher costs associated with local storm water requirements” I re-iterate my opening line, “never waste a good crisis.” In this economic down turn, can we afford to turn business to other states more willing to be affordable? Michigan? Indiana? Ohio? Just to put the picture into perspective, the portrait of affordable housing will look more like a one bedroom condo than the free standing home of the American dream. You can say this is rhetoric, you can say this is posturing. Look at the facts, not the sales pitch. Part 2: The governor of Virginia plans on dealing with this proposal as a slight change in regulation and forgo the legislative process . Doesn’t sound like the great country I remember.The Analysis and the logic don’t work. The benefit does not out weigh the incredible additional cost, nor does the benefit significantly increase. Theoretically speaking, the benefit would be like standing in line at the DMV and having the whole line of service people go to lunch when your number is called, while the disastrous financial impact would be like sending a crop duster airplane into battle In riding the “Green” wave the we are about to throw out the balance of reason. Don’t take my word for it. Do your own research, make your mind up and drink the kool-aid. The results will be evident.

Reminiscing…A Double Edged Sword

Thursday, July 23rd, 2009

Kids are a blast! Just recently a sales person of mine came into the office with his tag-along toddler in tow. I spent some time reminiscing about my kids when they were the same age and some of the silly, crazy things they would do. My favorite stories and antidotes bubbled up with excitement as we laughed together comparing similarities in kids and their behavior.

Like kids, real estate can be rewarding and challenging in any stage of any market. Reminiscing about the good ‘ole days of real estate can be like double edged sword. (more…)

How Does a School Bus Relate to Buying a House?

Wednesday, July 15th, 2009

When my kids were younger they had dreams about riding the “big yellow school bus.” Every day they would run to the window to see the “big yellow school bus” drop of the neighborhood kids.

Soon the older siblings would get off the bus with a cool look on their faces as the younger siblings would gawk in their honor…The school bus was a big transition each of my kids looked forward to. A transition from being a little kid at home to being a big at a big school. Amazingly enough my eldest, now 13, no longer looks at riding the school bus as a “cool” thing. He is now dreaming of driving my little commuter car. I’ve caught him sitting in the front seat of the car, daydreaming of his chance to drive. It is amazing how little he takes into account how small that commuter car is. My dream, a convertible. Amazing how times shift values. (more…)

Real Estate Incentives?

Monday, July 13th, 2009

Toaster or Pitcher? That was the incentive I could pick from when I opened up my new savings account in the early 1980′s. I was 12 and excited to have $200 in my coffee can. My young logic told me I could live an entire lifetime on that amount of savings.

There was a slight problem, I had my money in a Savings & Loan. Little did I know that I would possibly face losing my savings of a life time….big drama for a little boy.

In today’s real estate market it seems like new home builders incentive are thrown around with little thought in a panicked attempt to keep the elusive customer engaged. The interesting piece to all this is the potential buyer seem to be more interested in the actual incentive’s size than in what has driven real estate for years. But what does an incentive really project about a new home builder? (more…)

Thinning the Herd

Tuesday, July 7th, 2009
One of the big stories in the new home industry news recently was the Pulte & Centex merger. The merger was marketed as an opportunity to increase the ability to service their customers.
As I read the article, I scratch my head. Has any merger ever truly been able to increase service to the customer? As I look thru the latest edition of an industry publication it appears to me that many struggling builders are seeking to be snatched up or better word “acquired” by another firm just to stay alive.
As I take personal inventory, I have to admit that all builders these days are sucking wind as we go from the happy and fat feasting days of yore to lean and mean famine days of the present. (more…)