Houston realty agents stay on the bullish side

Houston Foreclosure & Real Estate News

By NANCY SARNOFF

Home sales are down. But the local economy is thriving compared to many parts of the country.

Builders are cutting prices on unsold homes.

But sales in upscale, inner-city neighborhoods and close-in gentrifying areas haven't lost a beat.

It's no wonder many buyers are sitting on the proverbial fence as they wait for some clarity in the housing market before jumping in.

So when will be a good time to buy?

Plenty of realty agents say it's right now, and at least one Texas economist agrees, with a caveat.

Mark Dotzour of the Real Estate Center at Texas A&M University said he wouldn't do it in Detroit or in some parts of California, but it still makes sense to buy a home in Houston.

Housing prices don't usually decline in markets with less than nine months of inventory— meaning it would take that long to deplete the current supply of homes based on sales activity during the previous 12 months, said Dotzour, the center's chief economist.

Houston has just over a six-month supply, according to the local real estate association.

Robert Searcy, an area real estate agent, had two closings, negotiated a price on a Heights bungalow, wrote and presented an offer on a foreclosure in the Galleria area and negotiated repairs on an East End cottage that sold in four days for above list price — all in one day last week.

"I am not seeing all this doom and gloom," he said.

While Texas is not immune from the nation's economic and real estate woes, it is insulated somewhat.

That's due in large part to the thriving energy business.

In 2007, the Houston/Sugar Land/Baytown area gained more jobs than any other U.S. metro area, according to a report by commercial mortgage banking firm Holliday Fenoglio Fowler, using estimates published by the U.S. Bureau of Labor Statistics.

Houston accounted for more than 10 percent of the nation's net job growth over that period. And together, Texas' four major metropolitan areas accounted for nearly 25 percent of the nation's job growth.

Dotzour expects home prices here to continue to rise, but at a moderate rate.

Still, he cautions shoppers to avoid pockets of the city where builders are offering concessions or big discounts.

Unless, of course, they can wait out the surplus, in which case a buyer could benefit from the perks.

 

Giving it another go

Despite years of sluggish sales and a batch of foreclosures, the owner of downtown's Commerce Towers is not giving up.

A grand "reopening" party was recently held for the condo building at 914 Main.

The project was announced in 1999, and the first tenants moved in during 2002.

The owners were betting that there was a market for luxury residential units that were more refined than the industrial-style lofts other developers were building.

But downtown street construction put a big damper on residential sales.

Today, the renovated 1920s building is only about half occupied.

And last year, more than a dozen units were foreclosed on, according to Foreclosure Information & Listing Service.

The condos range from the $400,000s to more than $2 million.

They go from 1,395 square feet to 3,800 square feet and up to 33,000 square feet for penthouses.

The party was meant to show off renovations, which include a putting green and improvements to the upper floors, said Susan Speck, who sells condos in the 122-unit building.

New York investment group Premier Towers owns the property, which was redeveloped by Whitney Jordan Group in conjunction with Tarantino Properties.

 

Broadway Square is sold

Harold Farb's estate has sold Broadway Square Apartments, a 2,469-unit complex near Hobby Airport that was built by the legendary developer in the early 1970s.

But unlike other properties of its era, Broadway Square won't be torn down and redeveloped.

The buyer, Los Angeles-based Post Investment Group, will pump $2.5 million into the sprawling complex to make roof and other repairs.

"Farb operated it very well. It had been a major keystone in the area offering quality affordable housing," said Jack Ehrman, Post's director of acquisitions.

"We're looking to restore it to its historical operations."

The company purchased the 69-acre property at 8751 Broadway through a joint venture with a New York private-equity firm.

The sale price was not disclosed, but Ehrman said it was well below market because of a 22 percent vacancy rate.

Other properties in the area sell for between $32,000 and $35,000 per unit, he said.

Broadway Square's rents range from 69 and 74 cents per square foot on a weighted basis.

Farb, who died in 2006 at 83, was landlord to more than 1 million people in a career spanning more than 50 years.

The developer's Nob Hill and West Point apartment projects sold last year to Austin-based Cypress Real Estate Advisors.

Post, which also owns a complex in Pearland, is negotiating for another property in the Galleria area. CB Richard Ellis brokered the sale of Broadway Square for the Farb estate.

Article Source