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December 2013/Jan 2014

 
    December 2013/Jan 2014

Golf Communities Report
Strong Sales Activity in 2013

   We asked some of our real estate contacts to provide an update on sales activity in the golf communities they cover.  Most reported upsurges in sales in 2013 compared with 2012.  Here are the highlights from a few of the communities we follow:

Glenmore Country Club,
Keswick, VA
    Tom Pace reports that he and Glenmore were “blessed” in 2013 with 21 more homes sold than in 2012, and at an average price of almost $751,000, up 18% over the prior year.  Tom and his agency sold 10 lots in 2013, up from just four in 2012, and at a 36% increase in average price.  With the university town of Charlottesville nearby, Glenmore is home to professors and administrators from Thomas Jefferson’s University of Virginia.  The friendly golf club’s John LaFoy layout uses the rolling topography to great advantage, and you can almost channel the Scottish hillside as you make your way around the course.  For a selection of current Glenmore properties for sale, click here.

The Landings at Skidaway Island, Savannah, GA
    According to Mike Burch at The Landings, the 200 homes they have sold year to date match exactly the number in the same period in 2012.  However, the average selling price this year of $436,000 is 5% higher than last year’s average sales price.  As in many other communities, The Landings is hosting more visits this year than last, with total visits year to date (through November) at 403, 11% higher than last year, and with an average stay of three nights –- not surprising, given The Landings size (4,800 acres), six golf courses, three clubhouses, multiple activities on site and proximity to Savannah; downtown is just 20 minutes from the front gate.  Click here for a sample of current Landings properties for sale.

Carolina Colours, New Bern, NC
    Ken Kirkman, the developer of Carolina Colours, reports that the 34 closings year to date are way up from last year’s 12.  Of the 34, 21 are home sites and 13 homes; the community has built a steady 12 homes or so annually the last few years.  Ken, who says visitors to the community’s sales office doubled last year but their web site saw only a minimal increase in traffic, foresees that increased interest rates and construction costs in 2014 might slow sales growth a bit next year. “Prospects will be well-advised” to keep an eye on the costs of borrowing and building, he says of planned community real estate in the South.  A 3/4 acre lot with lake view is on the market at Carolina Colours for less than $50,000.  Click here to see it and other properties for sale.

Balsam Mountain Preserve,
Sylva, NC
    Befitting its altitude, Balsam Mountain Preserve has reached some lofty sales figures this year, with 36 property sales compared with 24 this time last year.  Even more impressive, the 2011 figure was a mere two property sales.  The Balsam sales office hosted 125 real estate tours so far in 2013, up more than 50% over last year’s number.  Currently, Balsam Mountain has only one foreclosure sale on the market compared with 20 a couple of years ago; that clearing out of low-priced foreclosures has sent property values higher.  General Manager Bruce Fine reports that this month, five lots will close at an average price of $221,000; the average during “boom times,” says Fine, was around $500,000.  The Arnold Palmer group built the golf course at the very top of the mountain, with the most commanding views.  I only played it once and was bedeviled by some blind tee shots, but it was hard to stay frustrated for too long given the views and the dramatic par 3 holes.  If you would like me to introduce you to Bruce Fine, please let me know.

Colleton River, Belfair, Berkeley Hall, Bluffton, SC

   Our man in Bluffton, Tom Jackson, reports that the Hilton Head/Bluffton Multiple Listings Service data through November shows the best first 11 months of sales since the service started keeping computerized records in 1997. The 2,509 home sales so far in 2013 top the previous record of 2,452 home sales in 2005.   Tom says his office has been busy most of this year, with a home site sale in the “big three” communities every five days or so on average (76 in all year to date).  Part of the lure has been dozens of lots for sale at extremely low prices –- some as low as $1 -– offered by owners desperate to get out from under their obligation for carrying costs that include club dues. (See main story attached.)  The other attraction is that home sale prices are still down 32% from their historic highs.  “But we have lots of buyers,” Tom says, “and we will see home prices go up as lot inventory goes down and prices go up.”  Median home prices in the MLS area have climbed from their low of $250,000 in 2012 to $281,000 at the end of November, still well below the high of $395,000 in 2007 but up sharply this year.  For properties for sale in the big three communities in Bluffton, click here.

Daniel Island, SC
    Home On The Course, LLC, recently sold its first $1 million home here to a couple from Fort Myers, FL.  Of their choice, the husband and father of two teenage boys told us, “Good schools, great community, nice access to Charleston, an airport, health care and nice climate, very nice club with all the amenities. The club has a nice mixture of younger families with children and retirees.  We visited both grillrooms on a Friday night, one was adults only and lots of martinis, the other was filled with kids and parents eating hamburgers.  Everyone had a place to go and no one was imposing on the other crowd.”  Daniel Island Real Estate recently opened up a new section of home sites bordering two holes on Rees Jones’ Ralston Creek course, with golf and marsh views; half of the sites went under contract upon release.  The home sites ranged from the mid $200s to $550,000, indicating that the luxury buyer is back in the market, at least in the Charleston area.  We are featuring a 6 BR, 5 BA, 4,100 square foot home at our GolfHomesListed.com site.  Click here for more info on it and other Daniel Island properties.

As 2013 ends, should you consider
2014 the time to buy a golf home?

Q.  Is this the right time to buy a golf home in the South?

A.  Let’s put it this way:  The absolute best time to buy has passed, by about three years.  In 2010, prices had dropped so much that anyone with a pot of cash and a large appetite for risk would have gotten the deal of the century, literally, in some of the foremost golf communities.  But that was then, and things still looked dark.  But now our professional real estate contacts in the South are reporting increased traffic and sales in their communities (see sidebar), and you know what that means –- higher prices and lower inventory as baby boomers, their 401Ks restored by an historic stock market, finally take the leap and head South.

Q.  But don’t these continuing price rises all depend on the overall economy            

      improving?

A.  Mostly yes, but a little no.  I’m not an economist, but although there is always the risk of a backwards turn in the economy, most signs are modestly positive.  The “no” is that the stock market seems to have a mind of its own, and many people who rely on their asset base for the confidence to relocate are making the move now, selling their primary home and downsizing to a less expensive golf home, locking in their gains and investing in much more conservative instruments, and figuring that, come hell or high water, their retirement is pretty much set.

Q.  Have all golf communities seen dramatic increases in sales and prices?

A.  Not yet, and some of these areas are worth considering given their upside potential.  For example, the Myrtle Beach area has not yet seen a return to anything approaching its former price levels.  I looked at a listing this week for a 3 BR, 3 BA, 3,500 square foot home in the upscale Grande Dunes neighborhood in the heart of the city, on the Intracoastal waterway and about a half mile from the beach, with two outstanding golf courses, one private and one public.  The Tuscan-style home is listed at just $550,000.  At the height of the market, such homes were listed for close to $1 million.  That current purchase price of just $160 per square foot -– land included -- has to find a market, and maybe soon. 

Not everyone wants to be at the heart of a resort area like Myrtle Beach; the areas south of town (e.g. Pawleys Island and Murrells Inlet) and north in Brunswick County, NC, also still present some impressive bargains.  In the community in which I own a vacation condo, Pawleys Plantation, I note two golf villas listed for $120,000 or less.  At such prices, you should come close to recouping your annual payments by renting the unit out to vacationing golfers and still use it for yourself a couple of weeks a year.  (Note:  Management companies who handle these rentals sometimes charge as much as a 50% fee.)  At the height of the market, these units, some of which face the 10th and 11th holes on the Pawleys Plantation Nicklaus course, sold for nearly $200,000.

Q.  What are some of the other hot areas?

A.  Lately, the area I’m being asked about most is Charleston.  Just the other day, at a charity luncheon in Hartford, CT, I ran into a woman I had not seen in four years.  “Don’t you have a vacation home in Charleston?” she asked me, being off by about an hour; our home is in Pawleys Island.  “We bought a little carriage home in I’On and love it.”  I’On is a non-golf community with a walk-to-everything town concept in Mt. Pleasant, just northeast of Charleston, but with plenty of excellent golf nearby.  Earlier this year, we helped a couple from New Hampshire purchase a home in RiverTowne, just off the bridge in Mt. Pleasant from Charleston.  (Rivertowne’s new club owner has paired membership with Snee Farm, a classic George Cobb layout just 10 minutes up Highway 17.)  And a couple of days ago, we learned that a couple we worked with finalized a contract for a $1 million home on Daniel Island, the self-contained, two-golf-course community not 20 minutes from Charleston and just five minutes from the airport.  With national buzz about Charleston’s restaurants and its charming Low Country personality, we expect the influx of interest and sales traffic to continue.

Q.  Any other hot areas?

A.  On the coast, we find interest in Savannah, especially The Landings community, which celebrated its 40th anniversary last year.  People like its maturity, six golf courses and the fact that residents own and supervise everything on site -– the community, the golf courses and clubhouses, even the on-site real estate agency.  And Savannah is virtually hurricane proof.  But the mountains also continue to be a lure for many people, especially Floridians who, as they get older, seem to be less tolerant of the heat and humidity in the summer there.  Typical is a couple that lives in and loves PGA Village in Port St. Lucie, but they have had it with summers in Florida and asked me to help them find a summer home where the temperature and humidity readings are milder.  Since they have no predisposition for the geography of their search –- the wife laughingly answered “even Idaho” when I asked how far afield I could search -– I am looking first in New England, West Virginia, and the Blue Ridge Mountains of Virginia and the Carolinas.  Idaho golf communities are not my specialty, although there are a few highly rated ones.

Q.  Do most of those interested in the mountains want the Asheville area?

A.  Primarily yes, but there are not as complete a variety of golf communities in the Asheville area as one might think.  We love Mountain Air in Burnsville, NC, for its elevation -– almost a mile up there -– and unusual golf course that traverses the mountaintop community landing strip.  But it can get a little lonely at the top in winter when 80% of the community’s residents return to their primary homes in Atlanta and elsewhere.  The Cliffs at Walnut Cove, just 10 miles from the city, is as lush as you would expect a Cliffs community to be, but its development and sales efforts were stalled by financial issues.  New ownership has yet to reveal a cohesive marketing plan for all the Cliffs Communities, and customers we hear from are hanging back a little.  But it is hard to argue with Walnut Cove’s proximity to popular Asheville, or its Jack Nicklaus golf course.

Q.  Those are upscale communities with high-six-figure price tags.  Are there any 

      more-moderately-priced communities in the area? 

A.  Two of our favorite “high-value” communities are in the Hendersonville area, about 30 minutes from Asheville.  Tom Fazio grew up in Hendersonville and has lavished the course at Champion Hills with his most concentrated attention; like The Landings, Champion Hills residents run everything with a seriousness of purpose of which many a for-profit entity would be jealous (although the community outsources real estate services).  Nearby Kenmure in Flat Rock can hold its own with any mountain golf community, especially with its playable Joe Lee golf course and real estate that is priced a few percentage points below most expectations.  By the way, you can still find some excellent values for $200,000 and less; we offered a few of them at our blog site.  [Click here].

Q.  If Asheville doesn’t offer a wide variety of golf communities, how far does a

      mountain-oriented golfer have to wander to find a wider selection of golf

      communities?

A.  Not far at all.  There are pockets of golf communities throughout the mountains of western North Carolina to suit most every price range and golfing interest.  In the Cashiers area, about 90 minutes south of Asheville, you can spend more than $1 million easily at Mountaintop, the area’s most expensive community where Fazio has constructed one of the most talked about golf courses in the mountains; or you can go a little more downbeat at the clubs in Sapphire Valley or south of Cashiers at Trillium Links and former pro Morris Hatalsky’s quirky but unforgettable layout.  Up in the Waynesville/Sylva area, Balsam Mountain Preserve is under new management, Challenge Golf Group, and finally churning out new sales after a choppy beginning in the mid-2000s (see sidebar).  And in the Boone/Blowing Rock area, you’ll encounter some of the most regaled golf courses in North Carolina, with adjacent or nearby real estate, including at Grandfather Links, Old Hounds Ears and Linville Ridge. 

Q.  Do any of those legendary $1 lots remain for sale in some golf communities?

A.  Just a few.  Tom Jackson, our man in Bluffton, SC, reports that just nine $1 lots remain in the big three upscale communities there -– Colleton River, Belfair and Berkeley Hall –- after dozens of them sold this year.  “Most of the good ones are gone now,” Tom told us, “so what is left are not the most desirable, but they will sell [because of the price and scarcity], and lots of builders and investors are coming in to build homes as [there is a] shortage in some communities.”  Our advice is to consider following the lead of one of our customers, a recently retired oil executive who passed over a larger selection of $1 lots in Bluffton 14 months ago and purchased a $45,000 lot in Berkeley Hall that originally sold for $450,000.  He recently completed construction of his dream home and now has a view off the back deck of a pond and the sweep of the fairway to the green on a par five hole at one of Berkeley Hall’s two Tom Fazio layouts.  That stellar view was not available with any of the nine $1 lots available at the time.

Q.  Why are/were the lots priced at just $1?

A.  At the height of the market, irrational exuberance caused many buyers to not only buy a lot on which to build their homes, but also to buy other lots nearby in the expectation they could flip them in a year or two at a substantially higher price.  But in the Bluffton communities, and at developments like The Cliffs, club membership was essentially mandatory and tied to the lot, not the individual.  And that meant that every lot a person owned carried with it the obligation to pay monthly club and homeowner dues which, in some communities, amounted to more than $15,000 per year.  When the value of the lots plummeted way below the original purchase prices, the owners were still stuck with the obligations.  Thus it became expedient to give the lots away to get out from under those obligations. Today, for a couple expecting to live in one of these communities for the next 10 years and play a lot of golf, one of these remaining lots can be a great deal.  But to beat a dead horse, I suggest that potential purchasers look closely at other, slightly higher priced lots for better views and longer-term value.

Q.  If you could live in any golf community, where would it be?

A.  I am asked this question often, and I typically respond by saying I would probably choose the community with the best golf course -– i.e. the one I could play every day and enjoy, if I had the stamina and interest to play every day.  The most memorable golf community courses I have played in the last few years have included the May River Course at Palmetto Bluff in Bluffton, SC, Old Tabby Links on Spring Island, near Beaufort, SC, and Pete Dye’s layout at Ford Plantation, near Savannah.  But club fees are relatively high and homes in these communities are above $1 million, a bit north of my price range.  And like most of my customers, my spouse does not share my passion for golf, and my choice would likely not be my wife’s choice.  Since I am not interested in living alone at this point in my life, I would choose a golf community with something for both us (good golf for me, beach for her, and close to plenty of activities).  And there are dozens of choices in that category.

Q.  When only one plays golf, what do couples typically look for when considering

      a golf home?

A.  It is remarkably consistent.  The one who plays golf –- and by the way, it is sometimes the wife who plays and the husband who does not -– just wants a course he or she can play every day, even though they plan to play much less than every day.  The non-playing spouse wants a community in which friends can be made quickly, through clubhouse activities or clubs.  Typically, the larger the community, the easier it is to make friends quickly because of the preponderance of planned activities.  But smaller communities that, by their nature, are more intimate, can foster quick associations too.  In the end, it is more about how open and friendly you are as you take up residence and join the club.

Q.  What is the best way to kick off a search for a golf home that matches

      everything we want?

A.  If you are ready to start the process, I invite you to fill out my online Golf Home Questionnaire.  [Click here.] It takes only about 10 minutes to fill out and will help me –- and you –- focus on the criteria that are most important.  Once I have your requirements, I will consider which golf communities match up the best, and I will send you a note with my suggestions.  (There is no cost for the service and you are never under any obligation.)  After that, we can refine the criteria and the list of potential communities and, when you are ready, schedule some visits to the golf communities that best match your interests.  Right now, I am working with more than a dozen couples, but there is always room for a few more.

 

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   Larry Gavrich, Founder & Editor

   GolfCommunityReviews.com

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