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McMansions will be on the rise again
The Orlando Sentinel ^ | November 11, 2010 | Beth Kassab, Business Columnist

Posted on 11/29/2010 7:22:44 PM PST by 2ndDivisionVet

The McMansion, the mass-produced, super-sized home that saw its heyday earlier this decade, is poised to resurrect itself from the ashes of the real estate collapse.

A few months ago, real estate site Trulia declared, "The McMansion Era is Over."

Just 9 percent of the people surveyed by the site said their ideal home was more than 3,200 square feet. That news came on top of data from the National Home Builders Association that the median size of new homes dropped from 2,268 square feet in 2006 to 2,100 square feet in 2009.

The implication is that the recession has caused us all to abide by a new mantra that less is more.

That may be true when it comes to cars and over-the-top spending — the Hummer and Christmas shopping budgets that end in three zeros are long gone.

But when it comes to our homes, there's already evidence to suggest Floridians will still take as much square footage as they can get.

Meritage Homes is marketing an eight-bedroom, 5,100-square-foot model in several Central Florida developments that is proving to be a top seller.

The home, known as the Del Rio, perhaps best illustrates the new McMansion. Its architecture is uncomplicated, making it less expensive to produce at a more affordable price. It also provides ample space that is energy efficient for today's families that find themselves taking in an older relative or adult child....

(Excerpt) Read more at articles.orlandosentinel.com ...


TOPICS: Business/Economy; Local News
KEYWORDS: construction; economy; housing; realestate
Makes sense: If you have two, three or four generations under one roof due to the Obama depression, you need a lot of space.
1 posted on 11/29/2010 7:22:54 PM PST by 2ndDivisionVet
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To: 2ndDivisionVet

To me, the whole “McMansion” thing was always a sneer at people deciding for themselves what they wanted and what they needed.

Just like the whole “SUV” controversy, where again people decide what they want and need, while others sneer and try to use government to stop them. If you see the need and are willing to pay the cost, that should be the end of the discussion.


2 posted on 11/29/2010 7:26:21 PM PST by marron
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To: marron
Why that is downright American of you! Careful... obama does not like patriots.

LLS

3 posted on 11/29/2010 7:28:33 PM PST by LibLieSlayer (WOLVERINES!)
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To: 2ndDivisionVet

The trend is starting for the small cottage in the back yard just big enough for mom and dad while the main house is average.


4 posted on 11/29/2010 7:35:32 PM PST by griswold3 (Employment is off-shored, away from govt. regulations, price pressure groups, and liabilities.)
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To: 2ndDivisionVet

Pardon my cynicism but this sounds like a developwr with a lot of Plorida ,where it gets pretty hot,) air to sell.


5 posted on 11/29/2010 7:35:48 PM PST by mosesdapoet ("To punish a province Let it be ruled by a professor " Frederick The Great paraphrased)
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To: 2ndDivisionVet

Oh yeah! Things are REALLY looking up.

Last Hurrah for Housing

Case-Shiller is a backward looking index. The increasing number of foreclosures, the complete collapse in new home sales, a massive increase in inventory, and the end of tax credits all suggest we are near the end of the line for this bounce in home prices.

Interestingly, even the home builders are against another home tax credit. Is that reflective of the massive distortions caused by the credit, the realization the tax credit was useless, or the fact that homebuilders recognize there is little chance Congress will back another tax credit?

Regardless, here's the deal: New Home Sales Consensus 330K, Actual 276K, a Record Low. As a followup please see How Many New Home Sales Was That?

Expect to see new all time low prices in some cities later this year or next year as pent-up demand dries up along with incentives that merely brought that demand forward.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

6 posted on 11/29/2010 7:47:40 PM PST by Grim (That's why I'm voting for Sarah.)
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To: griswold3

Mother in law suites or boomerang kid cottages can be turned into a rental in some areas.


7 posted on 11/29/2010 7:50:13 PM PST by tbw2 (Freeper sci-fi - "Sirat: Through the Fires of Hell" - on amazon.com)
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To: mosesdapoet
Pardon my cynicism but this sounds like a developwr with a lot of Plorida ,where it gets pretty hot,) air to sell.

This ^^^^^^^^^^. My dad and I built spec homes back in the 1990's. We still receive literature from the architectural firms. Everything I have been reading is the trend is people are wanting smaller homes but very quality built.

8 posted on 11/29/2010 7:56:06 PM PST by hoyt-clagwell (5:00 AM Gym Crew)
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To: hoyt-clagwell

Yea..I know I have a buddy of mine down in Boynton and Palm Beach coutnies who tells me the place is loaded with foreclosed McMansions... One way I think these can be dumped is if their sold as a relative housing. That menas sold to a family group like 3-4 family units which are all related to each other. But then zoning has to be adjusted and the structures modified for privacy to allow this.


9 posted on 11/29/2010 8:27:03 PM PST by mosesdapoet ("To punish a province Let it be ruled by a professor " Frederick The Great paraphrased)
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To: hoyt-clagwell

Yea..I know I have a buddy of mine down in Boynton and Palm Beach coutnies who tells me the place is loaded with foreclosed McMansions... One way I think these can be dumped is if their sold as a relative housing. That menas sold to a family group like 3-4 family units which are all related to each other. But then zoning has to be adjusted and the structures modified for privacy to allow this.


10 posted on 11/29/2010 8:28:13 PM PST by mosesdapoet ("To punish a province Let it be ruled by a professor " Frederick The Great paraphrased)
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To: tbw2

You can buy a nice 30-35’ class “A” RV for under $20k (or a 32’ trailer for $8k), park it on the side of the house and have instant rental income...


11 posted on 11/29/2010 8:28:24 PM PST by Neidermeyer
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To: 2ndDivisionVet

Beth Kassab is just cheerleading, the Orlando Sentinel is one and a half feet into the grave already, without real estate listings the newspaper is going to go bankrupt.

I’ll put it bluntly, in the Orlando metropolitan statistical area, there is now an INFINITE supply of McMansions.

What I mean is, there is now a supply of
MLS listed +
Foreclosed +
Shadow Inventory +
90+ day deliquent mortgages
in the single family residence category priced at over 400K to surpass the average length of home residence for householders who buy a 400k home in Orlando MSA.

Until such time as tens of thousands of new householders move into McMansions that already exist in the Orlando MSA, there will never be again a new boom in McMansion construction.

On top of that, the average median salaries of the top decile of Orlando MSA households can still not support the current prices of the existing McMansion inventory, Orlando has at least a 7% further drop in prices just to reach a sustainable Case-Shiller market equilibrium, or the rent equivalent market equilibrium.


12 posted on 11/29/2010 8:30:49 PM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: mosesdapoet

The zoning changes won’t be approved ... you will probably see a great many “rooms for rent” ,, renting 1 or 2 spare rooms at $75-$100 a week pays a major part of the bills.


13 posted on 11/29/2010 8:32:02 PM PST by Neidermeyer
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To: Grim

are you the grim from nj re report blog?


14 posted on 11/29/2010 8:32:11 PM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: JerseyHighlander

So if an individual or couple/family have the means, now is the time to buy a nice home for pennies on the dollar?


15 posted on 11/29/2010 8:34:45 PM PST by 2ndDivisionVet (Re: Gov. Sarah Palin: Even the lion has to defend himself against flies. ~German Proverb)
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To: 2ndDivisionVet
McMansions will be on the rise again

Oh sure, and they'll heat them with cheap gas, cheap oil, and cheap air conditioning....

Big fat bloated homes ain't never coming back...

16 posted on 11/29/2010 8:37:29 PM PST by dragnet2
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To: griswold3

The preacher on Sunday was talking about not getting so caught up with “keeping up with the Jones”. He mentioned one of the congregation had told him “My wife and I had talked a long time about down-sizing. We had a $700,000 home, and now we have a $400,000 home. And we didn’t even have to move!”


17 posted on 11/29/2010 8:37:29 PM PST by 21twelve ( You can go from boom to bust, from dreams to a bowl of dust ... another lost generation.)
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To: Grim; JerseyHighlander; 2ndDivisionVet; All

The total visible and shadow inventory was 6.3 million units in August, up from 6.1 million a year ago. The total months’ supply of unsold homes was 23 months in August, up from 17 months a year ago. Although it can vary and it depends on the market and real estate cycle, typically a reading of six to seven months is considered normal so the current total months’ supply is roughly three times the normal rate.

http://www.corelogic.com/About-Us/News/Shadow-Inventory-Jumps-More-Than-10-Percent-in-One-Year,-Pushing-Total-Unsold-Inventory-to-6-3-Million-Units.aspx


18 posted on 11/29/2010 8:40:58 PM PST by FromLori (FromLori)
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To: 2ndDivisionVet

These truly ugly vinyl boxes are actually selling here, not quite that large but 4-5 bedrooms, “flex” room that can serve as another, over 3,000 sq. ft. but cheap, cheap, cheap. Slab foundation, no architectural detailing or embellishments whatsoever, just maximized space.

I have to admit, the cost per sq ft is amazing, but there’s nothing to want about them, they’re just square, flat sided, tall and deep with a shallow pitched roof, with as few windows as the law permits anywhere but the front facade, and even that is plain.

There’s nothing remotely “McMansion” about these things other than the space.


19 posted on 11/29/2010 8:43:17 PM PST by RegulatorCountry
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To: JerseyHighlander
I’ll put it bluntly, in the Orlando metropolitan statistical area, there is now an INFINITE supply of McMansions.

McMansions will make a come back when 6 ton family station wagons, with large gas sucking V-8's become popular again...

20 posted on 11/29/2010 8:44:28 PM PST by dragnet2
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To: 2ndDivisionVet


21 posted on 11/29/2010 8:45:27 PM PST by Teflonic
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To: 2ndDivisionVet

Buying a house in Orlando MSA at this point is a decision based more upon oil prices, currency inflation, and relative strength/weakness of the US dollar compared to currencies of foreign tourists.

If someone was looking to buy into Orlando nowin the 400k+ range, you can buy into Wekiva Springs, Dr. Phillips, Butler chain of lakes or Winter Park for prices not seen in 10 years. Newer stuff like Baldwin Park and large condos downtown can be had for the cheap also.

The thing is without tourism Orlando is sunk, the loss of Cape Canaveral will slow long term growth in the aerospace and technology sector, the bankrupting of so many local banks will slowdown longterm growth in the FIRE economy, and the region has a foreclosure backlog that is about to hit like a wave onto the market.

If oil makes air travel prohibitively expensive, if the Euro implodes pushing the value of the Dollar up, or if the local economy doesn’t find a new impetus of growth.... Orlando is looking at a decade of stagnation.

For retirees, Orlando is probably inflation adjusted as cheap as it was in the early 1980’s... which means if you come down with some money, you can live well.


22 posted on 11/29/2010 8:45:57 PM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: Teflonic

Something about that floorplan says modular to me, looks like boxcars lined up side by side with a few angular jogs to hide it.


23 posted on 11/29/2010 8:48:40 PM PST by RegulatorCountry
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To: RegulatorCountry

Yeah “cheap to build” = little to no architectural character.


24 posted on 11/29/2010 8:50:15 PM PST by Teflonic
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To: Neidermeyer
you will probably see a great many “rooms for rent” ,, renting 1 or 2 spare rooms at $75-$100 a week pays a major part of the bills.

Nope....All those rooms, for the most part, are now filled with unemployed family members, that were all forced to come back to the roost, or which ever family member is left with a home.

25 posted on 11/29/2010 8:53:27 PM PST by dragnet2
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To: Teflonic

If it were actually all stick built onsite, “cheap” doesn’t necessarily mean linear runs of interior walls front to back.

That house actually has a litte effort expended on the front at least, not like the radically bland things I was talking about. If you’ve ever heard of Jim Walter Homes, these make JW look charming by comparison.


26 posted on 11/29/2010 8:54:43 PM PST by RegulatorCountry
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To: FromLori

We’re in agreement on the national statistics.

I spent half of 2009 in Orlando dealing with residential real estate for a family member.

The banks in Orlando have a huge supply of homes in inventory. I got more comps in the hidden inventory than I did on the Orlando MLS in August 2009. Situation has mostly gotten worse for McMansions except in the few zip codes I mentioned above.

Houses worth exactly 400k in August 2009 are now sitting on market for 100+ days at 335k.

Average length of ownership for owners of 400K houses in Orlando is between 5.5 and 5.9 years.

The Case Shiller 20 city index does not include Orlando, but it does have Tampa, Miami and Atlanta... you can use those as proxies.
MIXR South Florida metropolitan area Miami–Fort Lauderdale–Pompano Beach, FL
TPXR Tampa Bay Area Tampa–St. Petersburg–Clearwater, FL
ATXR Atlanta metropolitan area Atlanta–Sandy Springs–Marietta, GA

I’m sure the McMansion inventory in Orlando will clear within a decade. There is still a wave of baby boomers to retire... but there has to be economic justification to move to Orlando... without some sort of economic stabilization and job growth Orlando is going to be stagnate for a while.

regards,


27 posted on 11/29/2010 9:01:14 PM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: dragnet2

I read this and I think to the scene in Dr Zhivago when Dr Zhivago returns to Moscow only to discover the Bolsheviks have moved 13 families into his parent’s house.


28 posted on 11/29/2010 9:02:14 PM PST by dfwgator (Congratulations to Josh Hamilton - AL MVP)
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To: RegulatorCountry

I’d hope they would be CBS, stick built structures don’t last long in Florida.

The front of the home is the only place they tried giving character to. The inside would be utterly bland, interior designers may enjoy the clean slate though.

I’d move the first floor master upstairs and put a 25’x30’ great room next to the kitchen and add a fireplace.


29 posted on 11/29/2010 9:05:55 PM PST by Teflonic
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To: Teflonic

Older people don’t like the idea of dealing with stairs constantly, so MOM, master on main. Chops up the flow of the public spaces on the ground floor, but they want it so there it is.


30 posted on 11/29/2010 9:09:31 PM PST by RegulatorCountry
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To: Teflonic

One of the Del Rio model is for sale near completion in Wekiva Springs

Price Monthly Payment* Bed Bath Living Garage Stories Sq. Ft.
$338,990 $1,675 8.0 4.0 3.0 2.0 5,107

$339k base + closing costs etc... come out to $360k at closing... neighbor same model sold for 350k in January.

$70.50/sqft

Actually a nice location if you enjoy river kayaking. Downside is the constant gator/snake presence.

2908 Falconhill Drive
Apopka, FL 32712


31 posted on 11/29/2010 9:28:19 PM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: 21twelve

Funny! Too bad it’s not a joke!


32 posted on 11/29/2010 9:37:02 PM PST by Secret Agent Man (I'd like to tell you, but then I'd have to kill you.)
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To: JerseyHighlander
are you the grim from nj re report blog?

No. I'm the other Grim.

33 posted on 11/29/2010 10:59:38 PM PST by Grim (That's why I'm voting for Sarah.)
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To: JerseyHighlander

What do you mean by ‘shadow inventory’? I’ve never heard the term before- are you talking about properties under contract?


34 posted on 11/30/2010 2:00:26 AM PST by Outlaw Woman (Lock & Load-Coming to a Neighborhood near you)
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To: marron

I’d say it was more a matter of ‘want’ than ‘need’ and a sneer at the taste of the nouveau upper-middle class.


35 posted on 11/30/2010 2:09:52 AM PST by 9YearLurker
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To: 21twelve

LOL


36 posted on 11/30/2010 5:31:27 AM PST by griswold3 (Employment is off-shored, away from govt. regulations, price pressure groups, and liabilities.)
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To: 21twelve

LOL


37 posted on 11/30/2010 5:31:27 AM PST by griswold3 (Employment is off-shored, away from govt. regulations, price pressure groups, and liabilities.)
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To: Outlaw Woman

FromLori posted a link to Corelogic, they track shadow inventory for a living. I would only add “discouraged sellers who would if they could immediately put their residential real estate on the market if the market showed signs of life” as another sector of shadow inventory.

http://www.corelogic.com/About-Us/News/Shadow-Inventory-Jumps-More-Than-10-Percent-in-One-Year,-Pushing-Total-Unsold-Inventory-to-6-3-Million-Units.aspx
Quote:

Shadow Inventory
CoreLogic estimates shadow inventory, sometimes called pending supply, by calculating the number of properties that are seriously delinquent (90 days or more), in foreclosure and real estate owned (REO) by lenders and that are not currently listed on multiple listing services (MLSs). Shadow inventory is typically not included in the official metrics of unsold inventory.

According to CoreLogic, the visible supply of unsold inventory was 4.2 million units in August 2010, the same as the previous year. The visible inventory measures the unsold inventory of new and existing homes that were on the market. The visible months’ supply increased to 15 months in August, up from 11 months a year earlier due to the decline in sales during the last few months.

The total visible and shadow inventory was 6.3 million units in August, up from 6.1 million a year ago. The total months’ supply of unsold homes was 23 months in August, up from 17 months a year ago. Although it can vary and it depends on the market and real estate cycle, typically a reading of six to seven months is considered normal so the current total months’ supply is roughly three times the normal rate.


38 posted on 11/30/2010 7:04:56 AM PST by JerseyHighlander (p.s. The word 'bloggers' is not in the freerepublic spellcheck dictionary?!)
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To: Big Giant Head

Check out this monstrosity! I think our kids would get lonely in such a huge place. Good thing it’s out of our price range, eh?


39 posted on 11/30/2010 7:42:07 AM PST by Marie Antoinette (Proud Clinton-hater since 1998.)
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To: JerseyHighlander

Thank you for the link JH.


40 posted on 11/30/2010 8:51:14 AM PST by Outlaw Woman (Lock & Load-Coming to a Neighborhood near you)
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To: Neidermeyer

“The zoning changes won’t be approved ... you will probably see a great many “rooms for rent” ,, renting 1 or 2 spare rooms at $75-$100 a week pays a major part of the bills.”

Not in citys (such as Chicago) where those structures are in areas zoned as single family residences. The city clamps down with stiff fines home owners doing this. The areas around the two airports has had pleanty of court cases where a home owner has been dragged into court and faced a stiff fine and the modifications ordered removed.


41 posted on 11/30/2010 11:23:31 AM PST by mosesdapoet ("To punish a province Let it be ruled by a professor " Frederick The Great paraphrased)
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To: Marie Antoinette

I kinda like it.... Too bad it’s out of our price range!


42 posted on 11/30/2010 3:02:27 PM PST by Big Giant Head (Two years no AV, no viruses, computer runs great!)
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