Lennar Opens 13 Model Homes On One Street

Original Story: BuilderOnline.com

Most residential builders construct one or two models to showcase what’s possible in a new community, but one of the country’s largest builders is taking model homes to a new level.

Miami-based production builder Lennar, which builds in 44 communities in the Tampa Bay area alone, needed a way to show off its products in one place without requiring customers to drive across several counties to see them. This Custom home builder Tampa instead, division executives decided to locate many of the company’s models in one place, a model home showplace called “Easy Street.”

The company recently debuted not one but two Easy Streets composed of 13 model homes each that will make shopping for a new home ultra-convenient. Located in two of its Tampa Bay, Fla. developments--Stonegate at Ayersworth in Wimauma, and Concord Station in Land O’ Lakes—the model homes found on each Easy Street will showcase the floor plans available in Lennar's nearby communities.

“Prospective home buyers can easily see our newly launched floorplans and walk from model home to model home all in one morning or afternoon,” says Mark Metheny, division president of Lennar Central Florida. “Our goal with Easy Street is to make it convenient so buyers can see all the available floorplans at one location, and then choose the community they want to live in.”

The home builder Tampa based shows the models of Easy Street are available in 13 communities in Florida’s southern Hillsborough and Pasco counties, a widespread area that would normally require miles of driving for a prospective buyer to see each one. That’s why customers appreciate the one-stop shopping experience provided at each Easy Street, says Steve Seeger, director of sales and marketing for Lennar’s Tampa Bay division.

“Our buyers really like the convenience of seeing all the floor plans before making their selection, and being able to see them all in one place,” says Seeger. “Once they pick the floor plan that works for them, then they can pick the community they would like to be in where that floor plan is offered.”

Building 26 model homes was a significant investment, says Seeger, who declined to provide the total expense of the project. “Fortunately Lennar has the resources for this type of project to provide convenience to prospective home buyers,” he says. The company is the second largest home builder in the country as ranked by the recently released Builder 100 list.

Each Lennar division uses a different strategy to showcase new floor plans and reach prospective buyers, says Seeger. The Tampa Bay division is the first to try the Easy Street approach.

The Easy Street homes are part of Lennar’s “Everything’s Included” approach, where all the features are included in the list price of the home. Visitors to Easy Street in the community of Stonegate at Ayersworth can see a wide range of model homes, from a single-story 1,276-square-foot three-bedroom to a 3,327-square-foot two-story six-bedroom.

The model homes at the Concord Station community’s “Easy Street” range from three to five bedrooms and 1,612 square feet to 3,777 square feet. Featuring many of Lennar’s most popular luxury features, these homes are part of the builder’s Legacy Series, with stainless steel appliances, granite countertops, ceramic tile flooring and more.

Housing Bidding Wars Back

Story first appeared in The Wall Street Journal.

A new development is catching home buyers off guard as the spring sales season gets under way: Bidding wars are back.

From California to Florida, many buyers are increasingly competing for the same house. Unlike the bidding wars that typified the go-go years and largely reflected surging sales, today's are a result of supply shortages.

Competitive bidding in the current environment isn't producing huge price increases or leaving sellers with hefty profits, as occurred during the housing boom. Still, the bidding wars caused by tight inventory provide the latest evidence that housing demand is starting to pick up after a six-year-long slump.

An index that measures the number of contracts signed to purchase previously owned homes rose in March to its highest level in nearly two years, up 12.8% from a year ago and 4.1% from February, the National Association of Realtors reported on Thursday.

The Wall Street Journal's quarterly survey found that the inventory of homes listed for sale declined sharply in all 28 markets tracked. Real-estate agents consider a market balanced when there is a six-month supply of homes for sale. At the height of the housing crisis, in 2008, there was an 11.1-months' supply. In March, there was a 6.3-months' supply.

Inventory levels in many markets were at the lowest level in years. At the current pace of sales, it would take just 1.5 months to sell all the homes listed in Sacramento, Calif., and 2.4 months to sell all the homes listed in Phoenix. San Francisco and Washington, D.C., each have 3.4 months of supply, while Miami has 4.1 months of supply. Other markets have plenty of homes. Chicago, for example, has 9.4 months of supply, while New York's Long Island has 16.1 months of supply. Even in those markets, the number of houses for sale is edging down.

Nearly 83% of offers that agents have made on behalf of clients in the San Francisco Bay area this year and 71% in Southern California have had competing bids. Agents represented a buyer that made the winning bid on a Gaithersburg, Md., home earlier this month after agreeing to adopt the dog of the seller, who was relocating and looking to find a new home for "Buddy," a white toy poodle.

Inventories are declining for a number of reasons. Some sellers, unwilling to accept prices that are still down from their peak by one-third, are taking their homes off the market in anticipation of higher prices down the road. Meanwhile, investors have been outmaneuvering consumers for the best properties, often making cash offers that are quickly accepted by sellers.

In addition, some economists say that inventory levels are being held artificially low because Fannie Mae, Freddie Mac and the nation's biggest banks have been slow to list for sale hundreds of thousands of foreclosed homes they currently own. The lenders slowed down foreclosure sales and repossessions after record-keeping abuses surfaced 18 months ago. Banks and other mortgage investors owned nearly 450,000 foreclosed properties at the end of March, and another two million mortgages were in some stage of foreclosure.

Inventories could rise, putting more pressure on prices, if the banks and other lenders step up their efforts to sell their properties. Real-estate agents say they aren't concerned.

The declining inventory of older homes is spurring sales of new homes. New home sales are up 16% so far this year, compared with a year ago, while inventories of new homes fell in March to their lowest level since record keeping began in 1963.

Meritage Homes Corp., a builder based in Scottsdale, Ariz., reported Thursday a 36% increase in orders for the quarter ending in March versus the previous-year period.

Even though bidding wars are pushing prices higher, many homes are still selling for prices far lower than a few years ago. Increased demand is entirely affordability driven, which says that there will be strong resistance to price increases by buyers.

Rents are rising at a time when mortgage rates have fallen to very low levels. The result is that the monthly mortgage payment on a median-priced home is lower than any time since the 1990s. Freddie Mac reported on Thursday that mortgage rates fell to 3.88% for the average 30-year fixed rate mortgage, near its lowest recorded level.

Housing markets face other headwinds. More than 11 million homeowners owe more than their home is worth. It is a big reason that the "trade-up" market has been stalled. These homeowners can't sell their current homes, let alone come up with the down payment for their next home.

Mortgage-lending standards remain tough. Real-estate agents say an unusually high share of deals are falling apart because homes won't appraise at the price that buyers have agreed to pay sellers.

Still, borrowers with stable jobs are looking to make deals.


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