On New Year’s Eve Day, I was visiting my kid brother’s family. They live in the fictional town of Suburbia, Long Island.
The next development over is a section of Woodbury called "The Gates" (don’t ask). This has long been a very nice upper-middle to upper class part of town, known for rambling ranches and big splits on one and two acre plots. I hadn’t been thru there in years. My bro said he had something to show me (he is, amongst other things, a successful Real Estate speculator).
So while the wives played with the kids and chatted, we took the convertible out (it was 56 degrees on 12/31/06) and tooled thru the neighborhoods.
I couldn’t believe the sheer number of knockdowns. It seemed that every 3rd house was either brand new, under construction, or had already been leveled.
The RAZR has a decent camera on it, so I took quite a few snaps:
These are what are replacing the ranches and splits:
How the prices developed was an interesting aspect of this: According to public records, most of these knockdowns were purchased over the past 24 months. Specs paid between $1.0-1.3M — essentially for the land, as they razed whatever buildings were on the property. The new homes had been first listed for $2.4m or so, but that was optimistic. Prices slipped to then $2.2m, and they are now holding at $1.99m — with few takers. But its a nice neighborhood (location location location), and as prices drop further there will be plenty of buyers — the only question is at what price point?
What I found so fascinating were the number of empty lots (knock downs) and half-finished homes — and according to the neighbors we met, quite a few have been that way for a while.
If any builders/developers here can provide insight, I’m curious as to what it costs to put up one of these bigger homes — not the land, just the construction costs. A few of these 5,000 sq. ft.homes were actually very handsome (not the boring red brick McMansions, but others). I am curious as to how much profit there is in these jumbo homes.
I’ll toss the rest of the snaps I took after the jump . . .
Category: Real Estate