INFLUX OF NEWCOMERS KEEPS BUSINESS STRONG FOR HOMEBUILDERS IN SUBURBS

Below are excerpts from a story that was published in “Prospectus” in The Buffalo News on Sunday, Jan. 25, 2015

Marrano’s expansive Deer Springs neighborhood in Lake View continues to grow as new streets and homes are added.  Photo by:  Robert Kirkham/Buffalo News

 “It’s been a terrific year,” said John Manns, vice president of sales and marketing for Marrano/Marc Equity, citing a 20 percent jump in sales this year, after a 35 percent leap the year before. “We could have been on cruise control. We’re really hustling to get everything done.”

While not setting new records, the strong market for new construction is driven by a mixture of renewed confidence in Western New York by those living here, and an influx of both newcomers and returning expatriates.

Many of these are successful business people or doctors, in their 30s, 40s and 50s. On the other end of the age scale, there is also a growing pool of retiring baby boomers who are ready to “cut back” to smaller patio homes, but still want something new and upscale, and are willing to pay for it.

It’s also harder for potential homeowners to get mortgages because tougher regulations are making banks scrutinize transactions more closely. And even the developers themselves are having a more difficult time getting construction loans, which makes it harder for them to stay on schedule with homes.

Still, builders are thrilled with the turnaround – especially compared to the harsh first three months of last year when the bitter cold and heavy snow stymied sales.

“We’re tickled,” Marrano’s Manns said. “We’re having a Cinderella year. It’s all coming together.”

Patio homes seem to be particularly strong, builders say.  Such homes are typically one story with large patios, although some builders have added a small second level or a walk-out basement to offer more living and entertainment space.

But the primary focus of the house is on the first floor, which makes them particularly attractive to older buyers moving out of much larger multistory homes.

Masonry exteriors – more stone than brick now – are particularly popular, as well as craftsman-style shake shingle roofs and siding. There’s more focus on cultured or man-made stone that looks natural but is more flexible in its use, and can be more easily and inexpensively applied to a home.

Inside the houses, granite countertops, white wood cabinets and stainless steel appliances remain attractive for kitchens, along with wider-plank hardwood floors, ceramic tiles and high-end laminates that look like hardwood. Specialized wine cooler drawers, spice drawers and towel cabinets are more common. Bathrooms are getting larger showers and double-sink vanities. And high ceilings, glass transoms, direct-vent fireplaces, built-in bookcases and detailed crown moulding are attractive.

Many homebuyers also are seeking convenient and open floor plans, lots of storage space, walk-in pantries, and either “daylight” or walk-out basements that can be used for recreation rooms, home theaters or extra sleeping space. Home automation is also popular, with controlled lighting and theater systems, whole-house audio and speakers or remote-monitored video cameras.

MARRANO INTRODUCES NEW 'TRADITIONAL' IN EVERGREEN LANDING

Marrano/Marc Equity Corporation is introducing a new Traditional two-story design with four bedrooms and 2.5 baths at 71 Waterway Lane in Evergreen Landing, off Tonawanda Creek Road in Amherst. 

The home features a full front porch and gabled rooflines.

Inside, the foyer presents hardwood flooring. A home office space is off the foyer. The country kitchen includes an island with breakfast bar, granite countertops, birch hardwood flooring and maple cabinets. 

"Enjoy your coffee in the morning in the east-facing sunroom," said Steve Converse, new  home construction professional for Marrano. The great room highlights a gas-burning fireplace.

The second floor of this home shows four bedrooms, two full bathrooms and a laundry area. 

This model includes central air conditioning, eight foot high basement walls and energy-efficient Pella windows, added Converse.

It is available and priced at $299,900. Ranch and two-story homes in Evergreen Landing start in the mid $200s.

Evergreen Landing is near Niagara Falls Boulevard for shopping, restaurants and everyday services.

All Marrano home buyers at Evergreen Landing will be able to take advantage of Marrano's Luxury Package Promotion. This limited time offer gives every new homeowner a choice of such features as granite countertops, stainless steel appliances, upgraded trim package and more, Converse said.

The model at 71 Waterway Lane is open from 1 to 5 p.m. Saturday and Sunday. From Niagara Falls Boulevard, follow Tonawanda Creek Road to Waterway Lane and turn left. Marrano's decorated model home center at 50 Boxelder Lane will also be open for viewing. 

For more information or an appointment, call Steve Converse at 809-8676.

Article originally published in the January 16th Home Finder.

STRONGER ECONOMIC FUNDAMENTALS EXPECTED TO DRIVE INCREASES IN HOME SALES

Improvements in economic fundamentals, notably employment growth among millennials, will fuel significant increases in home sales and housing starts and a modest rise in home prices in 2015, according to CoreLogic's 2015 Housing Outlookreleased earlier this week.

Sam Khater, deputy chief economist for CoreLogic, predicted an increase of 9 percent in home sales and a 14 percent spike in housing starts for the coming year in the report.

"In 2014, the post-crisis economic expansion celebrated its fifth birthday and the main economic drivers of demand, such as consumption and capital investments, experienced steady improvement," Khater said in the report. "Employment grew at an average of 2.0 percent on a year-over-year basis for the three months ending in November 2014, the strongest rate since the three months ending in March 2006, which was the peak employment growth of the last economic expansion."

Employment grew at a rate higher than the national average (3 percent, as opposed to 2 percent) for the 25 to 29 age group, which is good news for housing, because this age group is the key first-time homebuyer segment. Steadily falling oil prices, which are down 45 percent since June, provide more economic growth tailwind going into next year. The drop in oil prices reduces energy-related expenses not just for driving, but for residential real estate also, according to Khater.

The stronger economic fundamentals are expected to drive an increase in demand for housing in 2015; sales are expected to jump by 9 percent, up to 5.8 million from the 5.3 million reported for 2014. Housing starts are expected to increase by 14 percent next year, up to 1.1 million. While the upturn in housing starts is healthy, it is still 23 percent below the average of 1.45 million for the last 50 years, Khater said.

Mortgage rates fell below 3.9 percent in December for the first time since May 2013 when a spike in rates caused a slowdown in home sales. The falling rates have not translated to lower prices, however, as price-to-income and price-to-rent ratios remain high. This means home price growth will be muted during the coming year, according to Khater. Mortgage rates are not expected to increase much in 2015 due to low inflation.

Khater said in the report that an analysis of the three main drivers of underwriting (debt-to-income ratios, loan-to-value ratios, and credit scores) revealed that purchase underwriting remains tight despite all the discussion in the last year around loosening the credit box.

"While there has been clarification on GSE loan put-backs and new low down payment products, the impact of both will be fairly modest because the weak originations market reflects not just a modestly tight supply of credit, but very weak demand," Khater said.

Overall, the lower oil prices could play a key role in the recovery of the housing market and the economy overall. Lower oil prices have led to lower transportation and home energy costs, which not only save consumers money but increase consumer confidence, increasing the likelihood that they will spend money on big ticket items.

DS News (December 31, 2014)