185 replies to this topic

[mzweig]

As a part-time investor in residential real estate here in Fayetteville, I find it interesting when peple refer to the housing market as if it were defined entirely by price.  For example, you'll hear people say things such as "The $400,000 market in Fayetteville is terrible."  Markets are defined by buyers with common characteristics, and that is not one market! Buyers of $400K subdivision houses are completely different from buyers of $400K houses near Wilson Park and these markets will behave differently as a result.  The typical subdivision buyer in that price category is most likely a transient, college-educated, politically conservative middle manager with a spouse that works part time and two kids.  They are spending every nickel they can spend on a house and maybe should spend less but they stretch.  The buyers of the $400K house in Wilson Park probably have advanced degrees, one kid, one spouse works outside of the home or both do full-time for the university, and they could spend more on a house but don't.  

The bottom line is that I am putting my money into fixer-uppers in Wilson Park, Washington-Willow, and Mount Sequouyah, as I think the markets for these kinds of houses will do well even if Wal-Mart, Tyson, and other big employers faulter.

[Mith242]

Welcome to the forum mzweig.  You do raise some interesting points.  I do agree that Fayetteville isn't likely to be affected a great deal if one of the major companies in the metro movied.  I certainly can't blame you for fixing up homes in those areas you listed.  Those three areas are probably the three most desirable areas of Fayetteville.  I can't think of any other area as desirable as those three.

[Mith242]

This reminds me I walked by the edge of the Washington-Willow area and took a pic of one of the houses and posted it over in the NWA Picture of the Day topic.  I don't think I've really walked through the neighborhood and took pics since last fall with my old digital camera.  I need to head back over soon.  But since you've done a little work in that area I was wondering if you know of any info on many of the homes there.  I believe I've noticed three with little plaques showing the name and the date that they were built.  But many others in the area look just as old but don't have any info out.

[jim9251]

Not everyone is a Wal-Mart vendor and can afford those $400,000.00 homes. I think if someone would build a sub-division in Fayetteville and have nice homes priced around $100,000.00 they would sell as fast as they could build them. I'm a state employee and make a grand total of $31,000 a year. I sure couldn't affort those huge homes and I don't know too many people in my circle of friends who could. Luckily I bought my house new in 2000 before the housing market went nuts.

[masons_dad1]

jim9251, on Aug 21 2006, 07:43 PM, said:

Not everyone is a Wal-Mart vendor and can afford those $400,000.00 homes. I think if someone would build a sub-division in Fayetteville and have nice homes priced around $100,000.00 they would sell as fast as they could build them. I'm a state employee and make a grand total of $31,000 a year. I sure couldn't affort those huge homes and I don't know too many people in my circle of friends who could. Luckily I bought my house new in 2000 before the housing market went nuts.

Thanks for sharing! I make the same salary as you and I work for a Wal-Mart vendor. I wasn't fortunate enough to have bought a home when the housing market was geared toward lower-middle incomes and now I'm just waiting for the housing market to sink itself. Very few homes in the lower $100's are being built and I have a good feeling that in a few years, after these homes in the $200's+ sit empty, there will be plenty of homes going for $100K or less.

[mzweig]

I don't disagree that we desperately need more affordable housing in the Fayetteville area.  The problem is that one cannot afford to build them and make any profit.  The cheapest lots within the Fayetteville school district in some not so great looking subdivisions that are farther out of town are selling for $50K.  You simply cannot build a house on them that's going to sell for much less than $200K.  I think it would be great if the zoning regs/building codes/lending institutions would support small, high quality, modular housing at a higher density.  I do believe you could give people something that would look good and be very functional for $100K here if that were the case......

There are still cheaper houses in town that one can buy.  Look on the south side of town.  It's already going up in value and it will get more valuable over time.  If you buy on the right street you can find a decent home in the 1000-1200 square foot category for under $100K.  It won't be new, it may need a little cleaning up and repairs, but will be decent.

If you don't mind a long drive and traffic, look at Bella Vista.  Some of the smaller houses there built in the 60s and 70s are still under $100K.  Many are in the Bentonville school district.  All are in a safe area.  BV is the bargain of our region but suffers from lack of shopping and terrible traffic.

Mark

[mzweig]

Mith242, on Aug 21 2006, 03:40 PM, said:

Welcome to the forum mzweig.  You do raise some interesting points.  I do agree that Fayetteville isn't likely to be affected a great deal if one of the major companies in the metro movied.  I certainly can't blame you for fixing up homes in those areas you listed.  Those three areas are probably the three most desirable areas of Fayetteville.  I can't think of any other area as desirable as those three.

Thanks, Mith242.  I will add that I think Fayetteville should be the urban center of NWA.  We already have more of an urban core here with the square, Dickson, and University, and a higher density with more older housing.  All the projects being planned are high quality and will enhance the urban feel of our city.  Let Pinnacle be the suburban center and we can be the urban center.  That gives us a unique place in our region.

M

[mzweig]

Mith242, on Aug 21 2006, 03:45 PM, said:

This reminds me I walked by the edge of the Washington-Willow area and took a pic of one of the houses and posted it over in the NWA Picture of the Day topic.  I don't think I've really walked through the neighborhood and took pics since last fall with my old digital camera.  I need to head back over soon.  But since you've done a little work in that area I was wondering if you know of any info on many of the homes there.  I believe I've noticed three with little plaques showing the name and the date that they were built.  But many others in the area look just as old but don't have any info out.

The house I just bought and should close on either today, tomorrow, or Thursday, is at 412 E. Lafayette.  It looks bad now but will be beautiful when I am done.  It is a 6 bedroom, 3 bath house with a detached garage that has an apartment above it.  It was built in 1907 and supposedly has the woodwork from the Arkansas House from the 1904 St. Louis World's Fair in it.  The house has asbestos siding shingles that will be completely removed and it will be reshingled in western red cedar.  Ditto for the garage--it will be redone to look like it matches the house.  One bedroom will come out upstairs and another bath added.  Everything in the house will be refinished to a reasonably high standard in keeping with the period of the house tho I am not planning on ripping out the kitchen that was probably put in in the early 90s.

The house I live in is at 59 E. Prospect St.  It was owned by A.L. Trent who built it in 1935.  He was known for planting maple trees all over Fayetteville and was also the guy who started Wilson Park.  It used to be called Trent's Pond.  This is a roughly 3400 square foot stone house with 4 beds and 4 baths that I put another 200 square foot addition on.  I did a total rehab on the house and 3/4 acre yard.  I also built a new craftsman bungalow guest house on my property with a full apartment above a two car garage and a new art studio with a two car garage.  The house was recently photographed by Better Homes and Gardens but there's no promise it will get in there.  

I most recently redid 100 Skyline Dr.  It is a stone cottage that was built by Fayetteville architect, Thad Rowden, Jr. in 1937.  We put on a new roof, cleaned up the yard, finished the attic, and redid the basement, as well as refurbished the rest of the house.  It started out as 1460 square feet and now has about 2600 square feet of living area.

[Mith242]

mzweig, on Aug 22 2006, 01:17 PM, said:

I don't disagree that we desperately need more affordable housing in the Fayetteville area.  The problem is that one cannot afford to build them and make any profit.  The cheapest lots within the Fayetteville school district in some not so great looking subdivisions that are farther out of town are selling for $50K.  You simply cannot build a house on them that's going to sell for much less than $200K.

Mark

Really, what if you built dense housing like row houses?  Granted there's obviously some areas of the city where land is going to be more expensive but it would seem to me that there's got to be some area where some cheaper denser housing could provide some more affordable houses with still some profit for the developer.  Although the city might need to help things out with some incentives like no impact fees and so on for something like this.

mzweig, on Aug 22 2006, 01:36 PM, said:

The house I just bought and should close on either today, tomorrow, or Thursday, is at 412 E. Lafayette.  It looks bad now but will be beautiful when I am done.  It is a 6 bedroom, 3 bath house with a detached garage that has an apartment above it.  It was built in 1907 and supposedly has the woodwork from the Arkansas House from the 1904 St. Louis World's Fair in it.  The house has asbestos siding shingles that will be completely removed and it will be reshingled in western red cedar.  Ditto for the garage--it will be redone to look like it matches the house.  One bedroom will come out upstairs and another bath added.  Everything in the house will be refinished to a reasonably high standard in keeping with the period of the house tho I am not planning on ripping out the kitchen that was probably put in in the early 90s.

Interesting, nice to find out the history as well.  I didn't know that.

mzweig, on Aug 22 2006, 01:36 PM, said:

The house I live in is at 59 E. Prospect St.  It was owned by A.L. Trent who built it in 1935.  He was known for planting maple trees all over Fayetteville and was also the guy who started Wilson Park.  It used to be called Trent's Pond.  This is a roughly 3400 square foot stone house with 4 beds and 4 baths that I put another 200 square foot addition on.  I did a total rehab on the house and 3/4 acre yard.  I also built a new craftsman bungalow guest house on my property with a full apartment above a two car garage and a new art studio with a two car garage.  The house was recently photographed by Better Homes and Gardens but there's no promise it will get in there.  

More interesting history.  I know there used to be trees lining College Ave.  I had gotten the impression they were maples which would probably mean he had something to do with that.  Hard to imagine College like that now.  If the home gets in let us know.  I'll be sure to check that out.

mzweig, on Aug 22 2006, 01:36 PM, said:

I most recently redid 100 Skyline Dr.  It is a stone cottage that was built by Fayetteville architect, Thad Rowden, Jr. in 1937.  We put on a new roof, cleaned up the yard, finished the attic, and redid the basement, as well as refurbished the rest of the house.  It started out as 1460 square feet and now has about 2600 square feet of living area.

I can't say I'm familiar with that architect.  Do you have any pics of the house?

[Aporkalypse]

mzweig, on Aug 21 2006, 04:18 PM, said:

As a part-time investor in residential real estate here in Fayetteville, I find it interesting when peple refer to the housing market as if it were defined entirely by price.  For example, you'll hear people say things such as "The $400,000 market in Fayetteville is terrible."  Markets are defined by buyers with common characteristics, and that is not one market! Buyers of $400K subdivision houses are completely different from buyers of $400K houses near Wilson Park and these markets will behave differently as a result.  The typical subdivision buyer in that price category is most likely a transient, college-educated, politically conservative middle manager with a spouse that works part time and two kids.  They are spending every nickel they can spend on a house and maybe should spend less but they stretch.  The buyers of the $400K house in Wilson Park probably have advanced degrees, one kid, one spouse works outside of the home or both do full-time for the university, and they could spend more on a house but don't.  

The bottom line is that I am putting my money into fixer-uppers in Wilson Park, Washington-Willow, and Mount Sequouyah, as I think the markets for these kinds of houses will do well even if Wal-Mart, Tyson, and other big employers faulter.

You and I have the same tastes.  I love the Heights and Hillcrest areas of Little Rock and my favorite areas of NWA are the areas you mentioned in Fayetteville and the older homes in downtown Bentonville.

[mcheiss]

mzweig, on Aug 22 2006, 01:23 PM, said:

Let Pinnacle be the suburban center and we can be the urban center.  That gives us a unique place in our region.

I agree. Pinnacle will undoubitingly become the suburban center of NWA with it's lack of grided streets.

[mzweig]

Mith242, on Aug 22 2006, 06:10 PM, said:

Really, what if you built dense housing like row houses?  Granted there's obviously some areas of the city where land is going to be more expensive but it would seem to me that there's got to be some area where some cheaper denser housing could provide some more affordable houses with still some profit for the developer.  Although the city might need to help things out with some incentives like no impact fees and so on for something like this.
Interesting, nice to find out the history as well.  I didn't know that.
More interesting history.  I know there used to be trees lining College Ave.  I had gotten the impression they were maples which would probably mean he had something to do with that.  Hard to imagine College like that now.  If the home gets in let us know.  I'll be sure to check that out.
I can't say I'm familiar with that architect.  Do you have any pics of the house?

Higher density doesn't always bring down prices tho it seems like it should. The development at Salem Road is a good example of a nice little neourban project. Those places are now about $155K for a 1300 sq foot unit.  They have rear entry garages and alleys.  I had an idea to make an 8-unit building with modular units, stacked four on top of four, with a stairwell corridor and basement parking, that could be built inexpensively, but would be impossible to permit around here (or anywhere where that density would be necessary!)

A.L. Trent supposedly planted more than 2000 maples in and around the area, including college ave.  My house used to face college and was on a much larger parcel.  

Rowden was not any famous architect.  But this was his own home, from the 30s through the early 80s, and I have all the original plans, furniture layouts, and even the contract to build it.  Cool old history.

[masons_dad1]

Was watching the real estate cable channel today and noticed quite a few large new homes listed at $125-135K in all areas of NWA. I always gave up on that cable channel because they'd show 1 house at $130K then jump right into $180K+ houses. I wouldn't waste money on a 50-60 year old home for $80-100K then end up putting another $30-40K into it for repairs. Let those who are fortunate enough to be able to buy houses for mere investment purposes buy those old homes and fix them up then sell them for 3-4 times their value. So it seems the real estate market in NWA is not as grim as it seemed.

[Mith242]

mzweig, on Aug 22 2006, 09:15 PM, said:

Higher density doesn't always bring down prices tho it seems like it should. The development at Salem Road is a good example of a nice little neourban project. Those places are now about $155K for a 1300 sq foot unit.  They have rear entry garages and alleys.  I had an idea to make an 8-unit building with modular units, stacked four on top of four, with a stairwell corridor and basement parking, that could be built inexpensively, but would be impossible to permit around here (or anywhere where that density would be necessary!)

A.L. Trent supposedly planted more than 2000 maples in and around the area, including college ave.  My house used to face college and was on a much larger parcel.  

Rowden was not any famous architect.  But this was his own home, from the 30s through the early 80s, and I have all the original plans, furniture layouts, and even the contract to build it.  Cool old history.

I see, thanks for the info.

[mzweig]

masons_dad1, on Aug 22 2006, 10:19 PM, said:

Was watching the real estate cable channel today and noticed quite a few large new homes listed at $125-135K in all areas of NWA. I always gave up on that cable channel because they'd show 1 house at $130K then jump right into $180K+ houses. I wouldn't waste money on a 50-60 year old home for $80-100K then end up putting another $30-40K into it for repairs. Let those who are fortunate enough to be able to buy houses for mere investment purposes buy those old homes and fix them up then sell them for 3-4 times their value. So it seems the real estate market in NWA is not as grim as it seemed.

You should check out realtor.com sometime.  You can search all houses on multi-list in particular cities and price ranges.  

I will say, however, that in general, older houses in established areas are better investments than newer subdivision houses.  When the market gets soft due to less people moving to the area and higher interest rates, 1-10 year old subdivision houses take a hit, because the people who want them generally would prefer a brand new house that is customized to their tastes and no one has ever lived in.  The builders aren't busy then and the prices for those new houses go down.  The 1-10 year old houses may be listed for more than what a new one costs making them hard to sell.  Older houses, closer to town, are more resilient.  That said, there may be some bargains in those 1-10 year old houses as the population growth stalls.

[Aporkalypse]

masons_dad1, on Aug 22 2006, 11:19 PM, said:

Was watching the real estate cable channel today and noticed quite a few large new homes listed at $125-135K in all areas of NWA. I always gave up on that cable channel because they'd show 1 house at $130K then jump right into $180K+ houses. I wouldn't waste money on a 50-60 year old home for $80-100K then end up putting another $30-40K into it for repairs. Let those who are fortunate enough to be able to buy houses for mere investment purposes buy those old homes and fix them up then sell them for 3-4 times their value. So it seems the real estate market in NWA is not as grim as it seemed.

Older homes are the best opportunities for those who want a bit more than they could afford, though admittedly not in some of the neighborhoods we've been discussing.  If you're willing to put the effort into things yourself - installing laminate and tile floors, painting, relandscaping, removign wood paneling, etc you can add a significant amount of value to your home and eventually even sell it for profit.  Buying a 1950s-1980s home will get you a better constructed home than those built in the last ten years and often you can get a larger home for the same price because it is a bit outdated (the difference between Pleasant Valley or Leawood and Chenal, for example).  If you spend the money to remodel an older home without doing any of the work yourself, you aren't going to make that much on it.  Investing "sweat equity" in a home pays off.  I know a lot of people who made big profits by doing this in the Heights, Hillcrest and Stifft Station in LR as well as some older areas of Dallas.

[mzweig]

Aporkalypse, on Aug 23 2006, 10:33 AM, said:

Older homes are the best opportunities for those who want a bit more than they could afford, though admittedly not in some of the neighborhoods we've been discussing.  If you're willing to put the effort into things yourself - installing laminate and tile floors, painting, relandscaping, removign wood paneling, etc you can add a significant amount of value to your home and eventually even sell it for profit.  Buying a 1950s-1980s home will get you a better constructed home than those built in the last ten years and often you can get a larger home for the same price because it is a bit outdated (the difference between Pleasant Valley or Leawood and Chenal, for example).  If you spend the money to remodel an older home without doing any of the work yourself, you aren't going to make that much on it.  Investing "sweat equity" in a home pays off.  I know a lot of people who made big profits by doing this in the Heights, Hillcrest and Stifft Station in LR as well as some older areas of Dallas.

Amen, Burg.  Those who only want new houses are losing out on an opportunity to build equity faster and get ahead.

[masons_dad1]

Aporkalypse, on Aug 23 2006, 11:33 AM, said:

Older homes are the best opportunities for those who want a bit more than they could afford, though admittedly not in some of the neighborhoods we've been discussing.  If you're willing to put the effort into things yourself - installing laminate and tile floors, painting, relandscaping, removign wood paneling, etc you can add a significant amount of value to your home and eventually even sell it for profit.  Buying a 1950s-1980s home will get you a better constructed home than those built in the last ten years and often you can get a larger home for the same price because it is a bit outdated (the difference between Pleasant Valley or Leawood and Chenal, for example).  If you spend the money to remodel an older home without doing any of the work yourself, you aren't going to make that much on it.  Investing "sweat equity" in a home pays off.  I know a lot of people who made big profits by doing this in the Heights, Hillcrest and Stifft Station in LR as well as some older areas of Dallas.

mzweig, on Aug 24 2006, 09:09 PM, said:

Amen, Burg.  Those who only want new houses are losing out on an opportunity to build equity faster and get ahead.

I understand what you're saying, but I'm more willing to get a good deal on a newer house that doesn't really need any work than investing the time and cash into fixing up an old house. Besides, investing "sweat equity" into an old house could be risky with all the growth here and the fact that so many people moving here aren't willing to buy an older house. With my luck I'd fix up the house then a developer would come in and want to knock it down.

[mzweig]

masons_dad1, on Aug 25 2006, 10:34 AM, said:

I understand what you're saying, but I'm more willing to get a good deal on a newer house that doesn't really need any work than investing the time and cash into fixing up an old house. Besides, investing "sweat equity" into an old house could be risky with all the growth here and the fact that so many people moving here aren't willing to buy an older house. With my luck I'd fix up the house then a developer would come in and want to knock it down.

No one can knock down your house unless you sell it to 'em, Burg.  A developer can't just take it from you.

In any case, what we are saying is that the market is stronger for older houses, not weaker.  When the population growth slows due to Tyson and Wal-Mart slowing down (and that's already happening) it's the people who bought newer houses are going to see a decrease in their value and have a hard time selling them, not those in the best, close-in neighborhoods.  

That said, to each his own. Fayetteville and Rogers are two radically different areas and markets so that may account for the disconnect in our discussion here.   I don't know where you work but I sure would take a look at the BV area as I think there are some bargains there already.  And see if you can find a friend at a bank that does commercial lending to home builders.  You may get a house that a builder had to give back if you are willing to wait 6-12 months.

[masons_dad1]

mzweig, on Aug 25 2006, 02:42 PM, said:

No one can knock down your house unless you sell it to 'em, Burg.  A developer can't just take it from you.

In any case, what we are saying is that the market is stronger for older houses, not weaker.  When the population growth slows due to Tyson and Wal-Mart slowing down (and that's already happening) it's the people who bought newer houses are going to see a decrease in their value and have a hard time selling them, not those in the best, close-in neighborhoods.  

That said, to each his own. Fayetteville and Rogers are two radically different areas and markets so that may account for the disconnect in our discussion here.   I don't know where you work but I sure would take a look at the BV area as I think there are some bargains there already.  And see if you can find a friend at a bank that does commercial lending to home builders.  You may get a house that a builder had to give back if you are willing to wait 6-12 months.

I would definitely consider BV if it was to become incorporated. I can't stand their roads. I'm looking at houses in the Pea Ridge area and north into Missouri. I work in Bentonville so living across the MO state line would work for me and prices are incredibly low. I would also be avoiding BV traffic altogether in the Pea Ridge area. Pea Ridge just built a new elemntary/middle school so it's a good community for families.