‘A Sea Of Houses For Sale’ In North Texas
The Dallas News reports on the housing market. “North Texas homebuyers took a vacation in July. Sales of preowned homes were down 10 percent during the month, the largest decline in more than two years. ‘Buyer traffic is good, and we are doing better in the city than out in the suburbs,’ said (realtor) Darren Dattalo. ‘Outside the LBJ Freeway loop, houses are sitting there for a while. There are houses still on the market in Plano that I was showing in January.’”
“At the end of July there were 47,391 preowned single-family homes on the market in North Texas. That’s about 8 percent more than a year earlier. July’s fall-off in home sales in North Texas was the biggest decline since November 2003, when sales were down 14 percent.”
“When Fox & Jacobs recently decided it was time to move some houses, the Dallas-based homebuilder knew just how to catch women’s attention. It offered a year’s free maid service with the purchase of one of its North Texas houses. Builders are using enticements including free swimming pools, appliance upgrades and cut-rate financing to keep buyers interested.”
“With interest rates rising, the prospect of getting freebies with a new house has helped keep sales strong. And it’s lured some buyers away from the pre-owned home market.”
“‘These incentives are almost required at this point because there is so much unsold, finished inventory on the ground,’ said housing analyst Ted Wilson. ‘They are trying to move units, and they have been on a marketing blitz.’”
“And with good reason. While new-home sales in North Texas are still at record levels, the number of unsold houses is also soaring. Almost 10,000 unsold new homes were on the market at the end of June.”
“Along with freebies to buyers, builders are also offering bonuses and gifts to real estate agents who bring them a sale, he said. ‘There is a sea of houses for sale out there, and you do everything you can to stand out.’”
“That’s what Fox & Jacobs hoped to do with its recent limited-time giveaway of maid service. ‘We are trying to offer some things that appeal primarily to female buyers,’ said Lee Darnold, vice president of marketing in Centex Homes’ DFW Division. ‘Women have the biggest impact on the purchase decision.’”
“Nancy Grant, who bought one of the company’s homes in Wylie, said the service ‘will definitely come in handy. I can also use it to clean up the house I’m selling,’ she said.”
“North Texas’ two biggest public homebuilding companies, Centex and D.R. Horton, cited high incentives among the reasons for their recent declines in financial performance. ‘Discounts kind of go hand in hand with [purchase] cancellations,’ Centex chief executive Tim Eller said. ‘So if cancellation rates are fairly high, you can anticipate that discounts, in one form or another, will also be commensurately high,’ he said.”
“Almost a third of Centex’s nationwide home sales fell through during the most recent quarter, usually because buyers couldn’t sell their current home.”
‘Four Texas cities are on a list of top 10 cities for foreclosures as foreclosure rates climb in Texas, and the Dallas/Fort Worth Metroplex is near the top. Home sales are big in Dallas/Fort Worth but so are foreclosures — at three times the national average.’
‘Three other Texas cities — Austin, Houston and San Antonio — are also in the top 10. ‘I think what we’re seeing in the foreclosure side is the fact that people have gotten into too much property,’ foreclosure expert George Roddy said.’
Whatever happened to Sly Ace?
Alive and well and loving the housing bubble — had puts in LEND, CFC, and WCI last week, though I goofed and sold the LEND puts at the open the day after earnings; I figured 12% down was enough, but it just kept on going down.
I bought a rent house in Denton recently; new construction from Pulte. 15k in incentives plus a 3% commission taken off the price, so it cost 115k for a 3BR, 2 bath, 1800 sq ft. I did the contract on that one in June. Since then I have not been looking. My other houses are leased, though I have not raised the rent on any of the renewals as I am just happy the tenants are renewing.
Some houses in my neighborhood in Plano seem like they have been for sale for at least a year, though that is only based on seeing signs as I drive around.
Wow! It actually worked. You de-lurked, I thought you were gonzo for sure. I’m glad you have good renters, S.A. Better watch yer shorts there buddy, the big bad investment bank wooly bullies might take aim on a wittle HB bear such as yourself some day. Keep yer powder dry.
S.A.?
You are right about the shorts — I end up getting killed every once in a while. Sometimes I feel like the drug smuggler who has made millions yet keeps on doing it. I should quit now, but it is hard given that I strongly believe that the HBs and lenders are just beginning their decline and that it will be much worse than most think. Take WCI: it hit a 52 week low on Friday, but is there any reason to think that things in the South Florida condo market are going to get better?
What you have to ask yourself is what level of “bad” is reflected in the current price.
(There are houses still on the market in Plano that I was showing in January.’”)
sign up this guy.
I have a question about Texas. It seems to have not had major appreciation like other places, so why were so many new homes built on spec? I thought you needed to see rapid appreciation before the masses came in and bought “investment” houses?
That is a fallacy. In the inner city, there has been major appreciation, very similar to that in the bubble areas.
In the burbs, there is little or no appreciation because of the virtually endless supply of land and the appetite of the “unwashed” for new houses vs. older, not matter how crappy the new ones are.
Interesting.
Where I live in Calgary, Canada, we’ve seen 40%+ annual appreciation in the far-out new suburbs. We also have an unlimited supply of flat land to build for the next 500 years. Bizzare. Everyone tells me “it’s different here”
It is different. It’s Canada. Everyone wants to live there. Get a clue!!
Yeah, they (bulls?) always say that. CA’s real estate market never collapses because of limited supply of land, environmental restrictions, etc, etc, etc. Japan is surrounded by the ocean and over 80% of the land is mountainous (=uninhabitable or undesirable for living). Most major cities there are overcroweded. YET the bubble burst! (When the bubble burst, the population in Japan wasn’t shrinking yet.)
Yeah, they (bulls?) always say that–”CA real estate market never tanks because of limited supply of land, envrionmental restrictions/regulations, etc. etc. etc.” Japan is surrounded by the ocean and 80% of its land is mountainous (=uninhabitable). And most major cities there are overcrowded. YET the bubble burst! The CA market itself went down so much in the early 90’s. So much for the “limited (or unlimied) supply of land” theory.
I used to live in Irving (previously worked at the University of Dallas). It is a first-ring suburb, no-where near as far out as the other burbs. Even it has a near endless supply of land. UD has been trying unsuccessfully to sell land next to loop 12 for years.
The concrete foundations are prone to cracking in North Texas because they are poured on clay. I was told you have to water your foundation perimeter in the summer to try and prevent this.
What crappy construction, why not raise the house on piers and make the floor out of wood if this is a problem?
I also made many other observations of tract home construction in McKinny Texas. I was not immpressed. Acostic ceiling in the bathroom above the shower, fence posts made out of pressure treated landscape logs that warp like crazy, Vinyl siding on the exterior of house, chimmies that looked crooked in relation to each other as you sighted along them from the street, etc.
Pier-and-beam construction in the Dallas area does exist: in the older homes. The old run-down areas of Irving have this type of construction (I had several colleagues with this type of house when I lived there). It is just the new homes with this crappy construction.
You can find Pier-and-beam foundatins in reasonably recent homes around DFW - you just have to look for them.
Our house was built in ‘77 and is a pier-and-beam setup. That said, pier-and-beam not immune to problems. I had to shore up the corner of our foundation last year due to the situation around Lake Ray Hubbard (the whole east side between I-30 and hwy-66 is basically a steep hillside) Caught it real early thought, which is what most people seem not do.
But isn’t that the whole point?
Pier and beam is repairable if you get settling. Once a poured slab starts cracking, you’re in a world of hurt.
ajh — technically the slabs are repairable too — just not as much fun to do so by a long shot.
Alas, pier-and-beam is more expensive, and most builders cut every corner they can, even it means sub-standard slabs.
Depends on the moisture content of the clay when the slab on grade was placed. Clays are expansive relative to the moisture content.
There are a number of ways to avoid the problem, the ideal being over-excavation of the clay below the foundation & replacement with a non-expansive material. Unfortunately, that takes both time and money.
On expansive soil, proper pre saturation will mitigate much of the foundation problems. By proper I mean building a coffer dam around the pad, maintain a head of water on it for a couple of weeks, remove the dam and let the soil dry. What are left are cracks much like a dry lake bed. The theory is the soil has heaved or raised as much as possible, but it shrinks laterally instead of settling vertically.
Basically, you want to pour the flatwork on soil that is at its maximum expansion capacity.
Most contractors won’t/ can’t take the time to do this correctly.
FWIW
Never buy a house with foundation problems in Texas (even if it has been fixed and comes with a “life time guarentee”). It will cause you nothing but grief.
I agree. The legal/engineering problems around foundations are a cottage industry in Texas.
The problem being that none of the home owners have any money to pay the legal/engineering fees since they are about HELOC’d out.
For modest family homes (aka ’starter’ homes) I reckon I’m reading an argument for good manufactured homes here.
Avoid foundation problems anywhere if you can. I owned a house built on a hill in the late forties that had significant settling due to a few earthquakes. Hard to find good contractors to help and super expensive when you do.
You are correct that there is little appreciation in the suburbs. Houses are built on spec for at least two reasons: first, the builders need to build. It is what they do. To stop building would be to admit the game is over. Second, we have a lot of out of state investors here, creating artificial demand. Because the prices here are so low relative to where the investors are from, they figure they are getting a deal when they are actually overpaying; e.g., paying 160k for a 2,000 sq ft house that would cost 400k in California but will only rent for $1,200 so it still loses money.
The Dallas-based homebuilder knew just how to catch women’s attention. It offered a year’s free maid service with the purchase of one of its North Texas houses.
“Nancy Grant, who bought one of the company’s homes in Wylie, said the service ‘will definitely come in handy. I can also use it to clean up the house I’m selling,’ she said.”
-My question is Nancy a ‘flipper’?
I think the technical term for Nancy is “dumbshit”.
SoBay:
Interesting question. When I read Nancy’s comments, I thought “lazy” and how many months does she think the “maid service” will cover the mortgage payments on the house for sale?
Nancy , if not a flipper, sha is breaking a cardinal rule in housing “BEAR MARKETS”, sell your home 1st, then go select from one of the thousand discounts available!
Someone mentioned here that a lot of this housing fever was generated by women. This idea does not seem to be lost on the builders, they probably have focus groups to study these buying patterns. One way or another this thing is doomed, the longer it is prolonged, the worse the end result will be. Take your medicine folks.
i love women but cannot afford them. they have certainly driven my most ill-considered financial judgments. since i got a cat, my lifestyle economy has improved tremendously!
You could afford me. I keep my husband in style
this blog is full of contrarians! i wonder if a media driven resurgence of polygamy is funded by r.e. as the solution to all those soon-to-be-empty mcmansions….
I think it depends on the individual. I am extremely frugal (my friends say cheap), refuse to buy if I don’t see value, have no desire to keep up with the Jonses (who are broke anyway), and save at least 15% of my income. On the other hand, I know many, many men who spend like idiots. Fast cars, $1,200 BBQ grills (my friend’s husband), all the new toys, etc. I have a three year old 20 inch TV. Why so new? My power shorted a few years ago and blew out my electronics. How many men bought a plasma TV lately?
Spending and wealth building aren’t controlled by sex but by the person. The VAST majority of Americans do not live within their means. Both sexes. Find someone else who does live within their means and grow wealth together. (If you are a spendthrift avoid misers - you’ll be miserable.) I have one male and one female friend as good at saving as me - unfortunately, they did not “click” when I introduced them.
Be observant when dating. Does she expect you to pay for the best of everything. Does he have all the latest toys and an “I deserve it” attitude? If so, you’ve been warned.
A frugal female.
Are you single, hot, of child-bearing age, and willing to move?
To Australia?
And I have a 3 week old 20 inch TV.)
You sound great! Please send a picture of the TV!:)
I am happy to say that my wife is affordable (and so am I)!
I wife shops at garage sales and second hand clothing stores.
Beat that!
Txchick is vindicated. I await the coming flood of poor-me “investor” and homeowner stories from Texas.
Remember the Alamo!
Was it ever really in doubt? Hopefully the damage will be mostly to out-of-staters and investor types.
Was yours the “Texas; where RE bubbles come to die” quote?
I think it was more like ‘where their equity comes to die’. Carrying costs are high in Texas (like 3.5% of price or more), and appreciation in new areas in next to nil (or negative). You could have bought a suburban McMansion in 2003, sold in 2004 and lost 10% or more (after relator commissions, taxes, and ins alone)
Texas is not a bad place to live or raise a family, but it’s tough to be a real estate speculator here.
It was the worst July for existing-home sales in seven years, and median prices fell in every East Valley city except Mesa, the Arizona Real Estate Center at ASU Polytechnic reported.
There were 5,545 sales in July in Maricopa County, up slightly from the 5,460 in June, but it was the poorest July showing since 1999 when 5,240 sales were recorded, the center reported.
“We’re now beginning to see some drifting down of the median home prices not only at the county level but in some of the various localities, which you would begin to suspect and a lot of people have been waiting for,” said Jay Butler, center director. “The number (of sales) is somewhat lower than I expected it to be.”
The median price fell $60,000 in Scottsdale, $12,500 in Tempe, $5,500 in Chandler, $5,000 in Gilbert and $2,000 in Phoenix.
Year-to-date numbers show sales to be more on par with 2003 and 2004 than last year’s housing market ride to the moon.
So far this year there have been 41,835 sales, while it stood at 68,235 during the same time in 2005. Between January and July 2004, there were 56,745 sales and there were 41,200 during the same months in 2003.
——>>>>>>>>
“Generally, August about wraps up the resale year, so unless something unusual happens the remainder of this year, what you see is about what we’re going to get,” Butler said.
“We’re now beginning to see some drifting down of the median home prices ……WTF!!!
To be or not to be a flipper, that is the question.
Whether ’tis nobler in the mind to suffer
The slings and arrows of outrageous price deceleration
Or to take arms against a sea of houses for sale, …
Godd one, Stucco. LOL
Come on, finish it off! You have 16-20 lines to go!
BTW, this was an assignment in my Grade 12 English years and years ago; a very fun assignment, and one of the few memorable ones.
Too lazy
Nice
Don’t worry in a few years they will reflate the system with more bagholders.
http://www.financialsense.com/fsu/editorials/2006/0811.html
I’ve been harping on this story for several months now. I’ve written several letters to my senators and congressmen. So far no one except for a couple of posters here have even acknowledged this. One senator wrote back telling me he appreciated my input and to shut up. The surprising thing is that the folks on this blog are so far ahead of the crowd on the RE thing but can’t come to grips with the bigger picture yet. Keep posting as it is bound to turn on some lights at some point.
thoughAustin was still happening- told a firend not to buy in Coprus Chrisite
looks like tx is toast too……..
Is deflation so bad?
We are always told about the dangers of deflation, but recently I have been wondering if people miss the good side of deflation.
For example, if people came to learn that a house would be worth less in norminal terms after 30 years, they would buy smaller houses they really wanted to live in. This would save resources for more productive uses, while being enviromentally friendly.
You might argue no one would buy houses, but people buy $60,000 cars that are basically worn out of 10 years. So a cute house that cost $200,000 that lasts 50 years is not so unreasonable.
Some other benefits would be no taxation on inflated gains. With deflation any money you make is really new money, not like now where you need to make 4-5% just to keep up with inflation. When you pay tax on that, you really are paying a capital tax. With deflation you could just stick your money under the mattress and it would be worth more in 30 years.
Deflation would slow the economy over the short run, as people postpone purchases, but as with computers which constantly deflate, people will eventually buy because they want something. It is just people will spend more carefully and buy want they need.
The losers are big goverment and financial elites who can no longer benefit from access to millions of dollars of other peoples money. To make money in a deflationary environment you actually need to produce something of value, not speculate on prices going up. This would cramp the life style of people like Donald Trump, which I for one would be sad to see. Making money out of nothing is a nation pass time.
So in short, I am arguing that a gradual deflation, maybe 1/2 % a year maybe much better over the long term than our current system. It would be more constraining, especially on government, but people may also find there is more to life than just making money.
Thoughts?
Oliver
Mish? Is that really you?
Hang in there, Oliver. I would like to see that, too. Just 20 million more votes or so and we could change course on this barge. I think the best that will happen, though, is relatively short-term deflation in housing, then back to the usual pickpocketing.
I like the way you talk.
In reality, as opposed to in principle, it would be a bad idea.
In Japan they ended up printing money out the wazoo with no effect other than having a sufficiently high debt to GDP ratio that their soverign debt’s credit rating was reduced. That’s right, Japanese government bonds don’t have AAA credit any more.
In the USA the deflation would result in massive deficit spending and monetization on useless crap like Fatherland Security Boondoggles, and companies would likely outsource productive labor and capital even faster if they thought domestic demand was going down. If they are producing in China, and selling to Chinese, why bother having any US operations at all?
Dr Chaos has raised some interesting points. The Japan one, I will argue is bogus. The second point that America will lose jobs faster is valid, but I hope to show only in the short run.
I agree Japan had some issues, but I think what happened there was a combination of factors that was caused by a massive bubble in RE and stocks in the first place.
In Japan, the government attempted to “spend” itself out of a deflating asset prices by doing lots of silly things (lets not forget our bridges to nowhere in Alaska). But when the bubble bust in Japan, things were seriously out of whack. They did not want to implement a deflationary strategy, it was forced on them by market forces to correct the excess of the 90’s. Now would be the time to implement a strategy of slow but gentle deflation in Japan. After the bubble bust everyone hung on for dear life.
the “economists” in the press in this country carried on telling the Japanese they need to print money. These people did not read the BOJ reports, because the M1 money supply was often expanding at 30% or more a year during the deflationary cycle. In other words the central bank was dropping money from Helicopters at that stage.
I don’t have any data to back this next assertion, but my suspicion on why the Japanese money printing attempts failed was because the velocity of money slowed each time they printed more money. So printing money was like pushing on a rope. This point is worth remembering in case we end up in the same situation.
In short, I think you are looking at an issolated period in Japan where neither the governement nor the central bank wanted deflation, but they had no choice because the people knew asset prices were out of whack. Hence I think it is an unfair comparision point. It is like arguing inflation is bad because of what happened in the Weimar republic.
Lets move to you second point about losing Jobs. I agree marginal companies will be quickly flushed from the market as inflation no longer protects the inefficient use of capital. In a deflating environment, you must become more efficient at using capital (both human and monetary) each and every year. Those that don’t, suffer.
So over the short run, jobs will be lost. But over the long run (maybe 10-15 years) capital will flow to people who can but it to good use. in otherwords capital will flow toward those that can do something with it, as opposed to those who “know” the right people.
This will raise incomes and make the US a better place. I think it will restore more mobility to society which seems to have dried up a bit over the last 20 years. To get there won’t be a bed of roses, but that does not mean the effort is not worth it.
Oliver
Here, here!
I believe it was Kim who explained why the govt is vehemently anti-deflation. Basically, the two forms of taxation (monetary inflation tax and fiscal confiscation tax) are both relatively less effective in a deflationary environment.
What is more, when deflationary psychology takes hold, and Josephina Sixpack realizes she will be able to buy more stuff next month at Target if she keeps her cash stuffed under the mattress until then rather than spending it now, the result is a liquidity trap, where falling prices lead to delayed purchases, and the drop in demand from delaying purchases results in further drops in prices. Meanwhile, companies cut back on employment, as less production is needed when nobody is buying, and fears of unemployment lead to still less consumption demand. At this point, monetary policy becomes about as effective as proverbially “pushing on a string.”
I believe we are due for at least some version of the above scenario as the housing bubble unwinds, but I am quite certain that Bernanke & company have a plan in place, perhaps involving helicopter drops of recently printed money, to quarantine the broader macroeconomy from highly contagious housing sector deflation.
For the last year Texas in general was a destination spot for the flippers/equity locust . Now the investors are putting the houses back on the market along with the builders who overbuilt, looking to make a killing .
As Txchick has said many times ,the economy does not support the higher prices in Texas .Texas was a speculator driven market in the last 1 1/2 years .
“That’s what Fox & Jacobs hoped to do with its recent limited-time giveaway of maid service. ‘We are trying to offer some things that appeal primarily to female buyers,’ said Lee Darnold, vice president of marketing in Centex Homes’ DFW Division. ‘Women have the biggest impact on the purchase decision.’”
And if you don’t believe this jerkoff just ask Suzanne!
I like the idea of appealing to the weak link in the decision process. Women don’t spend much time thinking rationally about homes. It’s a nest. Let my fat-ass hubby figure out how to pay for it. After all, I deserve it!
when it comes to nesting, beaverpower can EASILY set up the average joe for a cordless bungee jump. “big kiss, sweetie … now JUMP!
that should have been, “now CHUMP!”
You guys are in trouble.
trouble comes in many forms….
I’m just saying… There are some sharp cookies on this board who happen to be women. I guess you haven’t riled any of the so far.
…them so far.
i am in awe of the quality of posters here, both male and female. if i had the business smarts of half of the women who post here, i’d probably be married to one of them. hats off to ben for putting this together! but this is a most unusual crowd, don’t you think? the main flow of society — and evolutionary psychology — is about BEAVERPOWER!
… and there’s no question that that beaverpower has driven plenty of guys to take cordless bungee jumps with $750K weights around their necks.
Geldings and Steers, lots of ‘em!
Seeing some of the same thing here in the Waco area (halfway between DFW and Austin). So my wife and I are struggling with what to do at this point. I’d appreciate any advice.
We own one of the smaller cheaper houses in an upscale gated subdivision outside Waco and probably have 20-25% equity judging from recent sales. We bought 3-years ago with a 5-year locked ARM thinking at the time that we were not going to stay in the area for more than 3 years while my wife did her residency. However she just got a great offer and we decided to stay and have 2 more years to go before our rate starts to adjust.
We like our house just fine but would like to put in a pool for the kids and to make the Texas summers more tolerable. However our lot is very wooded and the back yard kind of small so it’s not ideal for a pool.
So what I’m thinking is that we just put it up for sale next spring and see what we can get for it. If it sells, we’ll have a huge selection to chose from of houses that are slightly larger and that already have pools, or have lots better suited for pools. And if we don’t end up selling the house in 6 months or so, no worries, I just refinance to something like a 15 year fixed and put in a pool anyway and do some clever landscaping to make it work.
Luckily we’re in a position that our housing costs are a relatively small portion of our take-home income. We could probably qualify for 3-times the house we have now but don’t want a McMansion, just a comfortable house to raise the kids in.
In any event, my question is basically this. For people like us who are planning to stay in the area long-term, and who definitely want to own just for the lifestyle factor of having our own house long-term. How does one play these sorts of housing bubble markets?
Seems to me that the next year or to present an opportunity to snag the type of house we really want for the long-term in a neighborhood we like at a decent price provided that we get our existing house sold. On the other hand, if the existing house doesn’t sell then we just stay put. No worries.
Are there others in a similar situation? What do you do in a collapsing bubble market if you’re thinking of a move within the same market?
Yes, very similar. You sound like you have a great deal of common sense, and so will be fine. We reside in central OK and will probably sell in the spring of ‘08 after fifteen years. No worries, we (you and I) don’t have the wild price swings the coastal city folk do. Shop around when the time is right, take your time. Make contingency offers or sell first and rent. Good luck! Go Bears! Mort out.
I would like to hear more about exactly where you are. Does the community have a website or what town are you in?
Put the house on the market, just don’t buy before you sell, you would have nothing to lose. Good luck, btw my oldest is headed to Baylor (from CA) next week.
Since you are not “investing”, but simply want a place to live for the long term, ignore the bubble. Your house value will ebb and flow with the bubble, but so will another house you might buy.
Exactly.
I would like to hear more about exactly where you are. Does the community have a website or what town are you in?
We live in China Spring which is about 10 miles NW of Waco. It’s mostly a bedroom community for Waco but there is still a lot of quite rural farms and large horse ranches. The nicer subdivisions lie along the south bank of the Brazos river. The nicer houses in my subdivision have fabulous views from atop the bluffs the line the southern bank of the Brazos along here.
My neighborhood is a mix of Baylor profs and executive/professional types who work in Waco, mostly in heath care or tech jobs. Although I have a couple neighbors who commute to Fort Worth. With no traffic I can make the run to the Fort Worth Costco in about 1.5 hours via back roads to Hillsboro and then up I-35. I can’t imagine doing it on a daily basis. But they are married to spouses who work at Baylor.
This is a web site about our subdivision put up by the builder. Not much info.
http://www.wacocustombuilder.com/
If you search realtor.com for houses over $200,000 in the 76633 zip code, most of the results will be either from this subdivision or a somewhat larger called the Hills of Childress Creek which is close by where most of the lots are much larger in the 5-15 acre size
Sounds nice. I am always interested in pretty parts of rural Texas. Never got down to the Waco area that much; that’s why I was so surprised to hear about a place nice enough that a doc would want to settle there.
Oh, and thanks for the advice guys. What my wife and I have basically decided to do is put the house up for sale next spring like say March when the kids are still in school so it will be easier to show and then just see what happens. If we get a bite we’ll just find something nearby that is slightly more to our liking and get a traditional fixed loan this time. If not, then no big deal really. We can stay here just fine. I just want to be really really sure we’re not going anywhere before investing in something like a pool.
I know a whole lot of you are into renting as a hold-out strategy but for us that really isn’t going to be conducive for our lifestyle. We have 3 kids and finding a spacious nice rental home in our school district isn’t that easy. Besides, I like to fuss with landscaping and gardening and hate answering to anyone. We just want to settle down in a home that is ours and raise the kids. For us, life is too short to be messing around with real estate games. We just want to buy a house that we really like to live in for the next 18 years or so at least until the kids are gone and do our investing the easy way with broad-based index funds, 401(k)s and IRAs.
First of many
Homeowners insist builder fix damage
Midlothian: Choice Homes official, city to address complaints
11:50 PM CDT on Saturday, August 12, 2006
By HERB BOOTH / The Dallas Morning News
MIDLOTHIAN – Homeowners in three subdivisions here have given their homebuilder, Choice Homes, a choice of its own: Either fix their structurally damaged houses, or build them brand-new ones.
And after years of complaints in some cases, an executive with Arlington-based Choice Homes has agreed to meet Monday with Midlothian city staff members to see what can be done to address the homeowners’ concerns. Among them are faulty foundations, inadequate drainage, cracked walls, high water pressure and buckling streets.
About a dozen homeowners from the subdivisions, which are all less than six years old, brought their issues to the City Council last week.
Daniel Couture, chief operating officer for Choice Homes, said his firm wants to be responsive to individual homeowners.
“Obviously, we were a little taken aback by the report,” said Mr. Couture, referring to news accounts last week about the situation. “In regards to current Midlothian concerns, our team will attempt to resolve legitimate issues. I will be personally reviewing those cases.”
Midlothian Mayor Boyce Whatley said the city would respond within the next couple of weeks to homeowners’ concerns about high water pressure and poor road conditions.
Mr. Whatley said the clay soil in the area “expands and contracts a lot.” He added that the city has beefed up construction standards to guard against such structural problems since these subdivisions were started.
But Sherry Freeland and Rodney Washington – who both addressed the council Tuesday night – said nothing short of a new home would satisfy them.
Ms. Freeland said her main concern is drainage.
“My house is not saleable. They came in and did some berm work, but it’s still not right,” said Ms. Freeland, who paid about $160,000 for the 1,900-square-foot home that sits on a half-acre lot.
Mr. Washington said he’s put in three driveways in the six years he’s lived in Overlook Estates.
“Look at this,” said Mr. Washington, picking up a piece of concrete from his original driveway. “They used chicken wire instead of rebar.”
In addition, Mr. Washington has several cracks in his brick home and foundation, and a sloped living room floor in which a soccer ball rolls until hitting a wall or piece of furniture.
Mr. Washington said Choice Homes has sent repairmen but “all they do is cosmetic stuff. None of the things they did were long-term fixes.”
Matthew Benedict, another Choice homeowner, can’t open his back door.
“I’m a first-time homebuyer,” said Mr. Benedict, 27. “What’s my home worth now?”
Janet Ahmad, who heads up HomeOwners for Better Building, a San Antonio-based watchdog group, said residential taxpayers make up the bulk of the tax base and that it’s time someone represented them.
“Too many cities are influenced by the homebuilders because they bring in the money, but it’s the people paying taxes” whose voices need to be heard, said Ms. Ahmad, who attended the council meeting last week.
Mr. Whatley said maybe the alternative for the disgruntled homeowners is through the courts. However, at least in Ms. Freeland’s case – and many others according to Ms. Ahmad – litigation is not an option because Ms. Freeland signed a contract with Choice Homes that waives her rights to a courtroom. She must pursue arbitration.
But Ms. Ahmad and the Midlothian residents object to that process, which funnels them through the Texas Residential Construction Commission. She said a recent state comptroller’s survey showed 86 percent of those who confirmed construction defects through the commission process did not get their homes repaired.
“The TRCC is owned by the industry,” Ms. Ahmad said. “This is a state agency where there are foxes in the hen house. People need protection for what will be the biggest purchase in their lives.”
TRCC spokesman Patrick Fortner said more than 90 percent of the third-party inspections the agency has done because of complaints indicated some kind of construction problem.
Mr. Fortner said that after TRCC officials saw news accounts last week of the Midlothian troubles, they wrote a letter to Choice Homes asking the company what steps they were taking to rectify the situation. But he said that up until then, the agency had received only two complaints from Midlothian residents.
“I would encourage any homeowner who has a problem to contact the TRCC,” he said.
If the maids wear French Maid outfits, that would make the offer a whole lot more interesting…