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Housing Recovery At Various Stages Around The U.S.

Oct 16, 2011
Originally published on October 17, 2011 10:15 am

The housing market may be getting more attractive for buying a home. Foreclosures continue to rise, but prices are stabilizing in some places across the country. Just as communities experienced the housing bubble differently, they are also feeling varying degrees of recovery.

Charlotte: 'Two Chandeliers In The Dining Room'

In Charlotte, N.C., a foreclosed McMansion is going for half of its 2007 value. Lee Brown, a Realtor in the area, says Charlotte has a community of "starter castles" that were built at the height of the housing boom. They have "really ornate exteriors" with French, German and Swiss influence "all tossed into the same house," she says.

During the boom, she says, many people moved to Charlotte for high-paying jobs in the banking industry, but lost them when banks shut down after the crash.

One of the foreclosure properties sold for $1.27 million in 2007; Brown expects it to now sell for about $650,000.

"You're talking a beautiful home, and you can see it's got the hardwood floors, and it's got the fancy kitchen," she says. "And you're going to get two chandeliers in the dining room — and who needs two chandeliers in the dining room? But you know, hey, there's something for everybody."

East L.A.: 'Starting From Scratch'

In East Los Angeles, Realtor Felipe Acuna works in a once-glamorous neighborhood that is trying to make a comeback.

"City Terrace is ghetto fabulous. Investors are coming in and taking these properties that are not financeable because of the conditions that they are, and they're improving them dramatically," he says.

In 2004 investors began snatching up City Terrace properties left and right. Houses in awful condition sold for up to $500,000. Today many of those same homes go for just over $100,000, and efforts to gentrify the neighborhood are starting from scratch.

"The house on Ramboz Place was built I believe in the '30s. You weren't in the city. This was like the edge of the world here, but it was beautiful," Acuna says. "But unfortunately they're not as beautiful as they were back then. You have the freeway you can look at now and count the cars if you wanted."

The City Terrace housing bubble burst in 2007, and Acuna says he saw it coming.

"Even though you were like a gardener or a housekeeper and suddenly you were able to buy a half-million-dollar home that two, three years earlier was only worth $250,000," he says. "Unfortunately I tell people I probably could have increased my business two- to threefold if I would have took in those people and put them into something they couldn't afford and not worry about it, but I like to sleep at night."

D.C.: Subdued Bidding Wars

In Washington, D.C., things never cooled off that much. The district is considered recession-proof because of the high concentration of government jobs. In some neighborhoods, the market for starter homes is beginning to look a little like the boom period between 2005 and 2007.

During that time, there were bidding wars, says Valerie Blake, an associate broker with Prudential Carruthers Realtors. One war for a fixer-upper property raised the price to $435,000 from its listing price of $220,000. There were 28 bidders.

"In 2011, we're seeing a lot of first-time buyers re-entering the market. Bidding wars have once again returned; they're just not as frenzied as they once were," she says. "You might have two or three people bidding instead of 25. You might have an increase of $10- or $15,000, rather than hundreds of thousands. But they have to be perfect in this market. You cannot just throw anything out there ... and expect that there will be people lined up at the door."

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RENEE MONTAGNE, HOST:

We're going to hear now from three realtors selling homes in three very different parts of the country: East Los Angeles, Washington, D.C., and Charlotte, North Carolina. In Charlotte, you can buy a foreclosed McMansion for half its original price.

(SOUNDBITE OF MUSIC)

LEIGH BROWN: I'm Leigh Brown. I'm a realtor in the Charlotte, North Carolina metro area. We are in what I like to call a starter castle, which were the houses that were built in the height of the real estate boom that have really ornate exteriors with a little French influence, a little German influence, maybe a little Swiss influence, maybe some Italian and Spanish, all tossed into the same house. So we have a whole community of those.

MONTAGNE: Realtor Leigh Brown says during the housing boom, many people moved to Charlotte for high-paying jobs in the banking industry, but lost those jobs when banks shut down after the crash.

BROWN: The house that we're standing in now is a foreclosure property that originally sold for $1.275 million in 2007. It's likely going to sell somewhere around the 650 mark, and you're talking a beautiful home. And you can see it's got the hardwood floors and it's got the fancy kitchen. And you're going to get two chandeliers in the dining room. And who needs two chandeliers in the dining room? But, you know, hey, there's something for everybody.

(SOUNDBITE OF MUSIC)

MONTAGNE: Let's travel clear across the country now to East Los Angeles, where realtor Felipe Acuna takes us on a tour of a historically working-class neighborhood that's trying to make a comeback.

FELIPE ACUNA: City Terrace is ghetto fabulous. Investors are coming in and taking these properties that are not financeable, because of the conditions that they are, and they're improving them dramatically.

MONTAGNE: Back in 2004, people began snatching up City Terrace properties left and right. Houses in awful condition sold for as much as a half-million dollars. Today, many of those homes go for just over a hundred thousand dollars, which accounts for the current effort to gentrify the neighborhood.

ACUNA: The house on Rambles Place was built, I believe, in the '30s. You weren't in the city. This was like the edge of the world here. But it was beautiful. But unfortunately, they're not as beautiful as they were back then. You have the freeway you can look at now, and count the cars if you want.

MONTAGNE: The City Terrace housing bubble burst in 2007, and Felipe Acuna says he saw it coming.

ACUNA: What we saw was prices skyrocketing. Tell me what you make, you got good credit, you're breathing, here you go - even though you were like a gardener or a housekeeper. And suddenly, you were able to buy a half-million-dollar home that was, two or three years earlier, was only worth 250.

Unfortunately, I tell people I probably could've increase my business two to threefold if I would've took in those people and put them into something they couldn't afford and not worry about it. But I like to sleep at night.

(SOUNDBITE OF MUSIC)

VALERIE BLAKE: My name is Valerie Blake. I'm an associate broker with Prudential Carruthers Realtors, and we are here at a condominium in Washington, D.C. known as 1010 Mass, because it's located at 1010 Massachusetts Avenue. We're on the ninth floor in unit 903. We have one bedroom and one bath here. We have it listed for $537,500.

MONTAGNE: That would be in recession-proof Washington, D.C., where things never cooled off that much. In some neighborhoods, the market for starter homes is beginning to look a little like the boom, between 2005 and 2007.

BLAKE: We had bidding wars. I had one that was a fixer-upper property that we listed for $220,000. We had 28 bidders, and it went for 435. In 2011, we were seeing a lot of first-time buyers reentering the market.

Bidding wars have once again returned. They're just not as frenzied as they once were. You might have two or three people bidding instead of 25. You might have an increase of 10,000 or 15,000 rather than hundreds of thousand. But they have to be perfect in this market. You cannot just throw anything out there like there - that happened in 2005 and expect that there be people lined up at the door.

(SOUNDBITE OF MUSIC)

MONTAGNE: That was realtor Valerie Blake in Washington, D.C. We also heard from Felipe Acuna in East Los Angeles and Leigh Brown in Charlotte, North Carolina.

(SOUNDBITE OF MUSIC)

MONTAGNE: This is NPR News. Transcript provided by NPR, Copyright NPR.