Real Estate Recession Over In Lakewood Ranch
Monday, August 22, 2011
REAL ESTATE RECOVERY CONTINUES ON THE RANCH
At one of the nation’s most desirable master-planned communities, trusses are flying, trucks are buzzing and construction workers are back on the job as 165 homes are in some stage of construction in Lakewood Ranch, Fla.
"At this rate, I think we'll sell 420 homes this year," said Milt Flinn, president of LWR Communities LLC, "That's more than triple what we did in 2009."
The return of construction in Southwest Florida's largest development community is a welcome sight, as homebuilding is one of the top industries in the region and a main economic driver.
"The best properties are the ones that rebound first, and Lakewood Ranch is one of the best properties in the area," said Pat Neal, whose homebuilding company Neal Communities, accounts for half of all new home sales in Lakewood Ranch. There are 17 additional new home builders on the ranch, including one of the newest players—Taylor Morrison Homes, set to begin construction on the community’s first active lifestyle community this fall.
With just 113 resale properties for sale in Lakewood Ranch, down from a peak of 850 in 2007, most buyers are steering toward new properties, which tend to only cost about 10 percent more than a resale. New home sales are now at their highest point since 2007, with 150 sales in 2008, 120 in 2009, 250 in 2010 and estimates of 420 for this year, based on year-to-date numbers.
"We noticed the biggest change in the market last fall – at the point where buyers were unable to find homes they wanted among the picked-over inventory,” said Jimmy Stewart, sales director for LWR Communities.
The main driver behind all this buying, homebuilder Neal said, are OPALS -- "older persons with active lifestyles."
"They've been postponing retirement since the bust started six years ago," Neal said. "They've finally sold their homes in Cincinnati and Baltimore and they're coming down."
Fifty-seven percent of Neal Communities' buyers are people from out of state at the time of their purchase, and Neal says he expects that to continue.
"There are 78 million baby boomers, and one-sixth of them will spend some of their life in Florida," he said. "That's 13 million people from 2008 to 2023."
Of all the home buyers in Lakewood Ranch so far this year, more than 60 percent have paid cash. “These are people who have visited before and have been watching the market. They have the money to buy and they know now is the time,” said Flinn.
Demand from that group has been so strong that LWR Communities recently raised lot prices by $8,000 to $18,000 in Country Club East, one of its newest neighborhoods.
"We needed to create downward demand in some areas," said Flinn, LWR Communities' president. "We don't want all our most desirable lots to sell first and have only our less desirable lots to sell."
Average lot prices in Country Club East were at $143,685 in 2008 and dropped again to $103,970 in 2009, but have now increased for two years in a row, coming in at $111,989 in 2010 and year-to-date in 2011 are at $130,102, as of July 30.
With its wide assortment of homes ranging in price from $150,000 to multimillion-dollar mansions, Lakewood Ranch caters to a large range of buyers.
There have been 18 homes sold so far this year in The Lake Club, Lakewood Ranch's most exclusive and expensive neighborhood, with an average price of $1.2 million.
"Four of those homes are over 12,000 square feet and two are 18,000 and 20,000 square feet," Flinn said. "Our clubhouse is 19,500 square feet."
Total sales in the Lake Club could hit 36 this year, he said.
Foot traffic to the Lakewood Ranch Information centers is up dramatically, which is always a precursor to rising sales. With 15,344 visitors in 2008; 17,698 visitors in 2009; 23,346 visitors in 2010 and 20, 576 already this year.
“We only expect it to get better,” said Rex Jensen, president and CEO of Schroeder-Manatee Ranch, the developer of Lakewood Ranch. “We credit much of our success to our early strategy of job creation here on the ranch--there are two jobs for every home built and by creating our own recovery efforts, like adding our new 75-acre multi-use sports complex this year. With 10 major sporting tournaments already on the books, we know the Premier Sports Campus will inject millions of dollars into this area’s economy, with home buyers to follow.“
Lakewood Ranch is the 8,500-acre award winning master-planned community in Sarasota and Manatee counties on the West Coast of Florida. Just minutes from the Gulf Coast beaches, and cultural assets in Sarasota, Lakewood Ranch is already home to more 15,000 residents and features A-rated schools, a hospital, the Sarasota Polo Club, its own Main Street with theaters, a 75 acre sports complex, shopping and dining, and four million square feet of commercial property. For more information Visit www.lakewoodranch.com.