Are Finished Lot Transactions on the Horizon?

It appears as though finished lots are again in heavy demand in some Western housing markets. According to a Builderonline.com article (which can be read here), finished lots are selling for between 35 and 40 percent of their pre-2007 prices in places like Phoenix, Las Vegas and the Inland Empire. The buyers are typically national or large regional builders, which makes sense since they are the only builders with easy access to capital.

Of course, this begs the question, if lots are being snapped up in these markets, how long before we see significant lot transactions taking place in the Chicago region? By our estimate, there are nearly 65,000 finished lots in the 7--County metro area (excluding the City of Chicago). Our guess is that we will see some transactions occur before the end of this year, but we will not see buyers flock back into the land market until mid-2010. Of course, most available lots are either owned or controlled by banks and the banks have been very hesitant to sell lots at a tremendous discount. Another issue that builders will have to consider when acquiring finished lots are the building permit and impact fees in the community where the lots are located. Many municipalities are contemplating offering builders "incentive programs" of reduced fees, while many communities will do nothing to assist the development and homebuilding industries, stating that "development must pay its own way."

The bottom line is that lots will begin moving again in the near term, but an assist from the banks and municipalities will determine where the transactions take place.

Social Networking?

We were fortunate to be able to attend a Social Networking seminar (Social Real Estate Chicago) geared toward real estate professionals in Chicago earlier this week, which opened our eyes. It is clear that many (and by "many", I mean millions and millions) people are migrating to this new (at least new to us) form of communicating. It is clear that if you are trying to reach consumers you must have a blog, a Facebook page and be twittering, but what if you are trying to reach other businesses? This is where our confusion comes from. Are our clients and potential clients really spending time on Facebook? Do they really read their "tweets" all day long? Do we really want to spend our time "tweeting?" We have already figured out that blogging is an important part of our world. It allows us to get out information, opinions and thoughts in a non intrusive manner. Facebook and Twitter are completely different animals. They take time each day in order to keep them up-to-date and, again, were not sure who is reading them.

This is where we would like your help. Please tell us what you think of this "new" form of communication. Do you tweet? Do you have a professional Facebook page? Please leave us a comment below or even contact us directly.

We look forward to your response.