A report out today says that nationwide, sales of new homes dropped to a 12 year low in December, ending the worst sales year since records began in 1963.
The report, issued by Shobhana Chandra of Bloomberg News, says that despite builder’s reduction in inventory, they failed to keep pace with the decline in sales. The price of new home fell to 11.3% from one year ago to an average of $219,200. Sales are off 26%, the most since records began in 1963. As the saying goes, "All Real Estate Is Local." National trends notwithstanding, local factors such as supply and demand, location, proximity to desired schools and employment, utilities, etc. predominately drive the housing market. How does the national trend compare to the local Fairbanks real estate market? Comparing December 2007 sales of Fairbanks new construction to the previous year shows we lost a little ground with respect to both units sold and the average sales price. The number of new Fairbanks homes dropped 45% while the average sales price dropped 8.3% from the previous year. If we look at the selling price history for Fairbanks new construction (to include North Pole) we see that prices have risen 14.2% in the past two years; 36.1% since 2002 and 53.4% since 1999. While external factors are pushing prices down somewhat, looking at the long term trends it seems to indicate that Fairbanks real estate, specifically Fairbanks new construction is still a good investment. What does a new home in Fairbanks look like? The average Fairbanks new construction home is 1,648 square feet, has 4 bedrooms, 2 full baths and enjoys a .82 acre lot serviced by pubic utilities. The average price for Fairbanks is $257,543. Of the 52 currently listed, 28 are single family homes, 17 are zero lot lines, 6 are condos and 1 is a duplex. |
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Moving to North Pole new construction, the average home is 1,575 square feet, has 3 bedrooms, 2 baths and sits on a .77 acre lot with only 35% being serviced by public utilities. The average sales price $246,301. Of the 45 currently listed, 38 are single family homes, 4 are duplexes and 3 are condos. |
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There are many advantages to buying a new construction home over an existing home. Given the rising cost of utilities one of the main benefits is that new homes are much more energy efficient. There is often less general maintenance on new homes built with low or no maintenance materials. New homes can also be tailored to fit your personality; depending on the stage of construction, builders often give buyers a choice of cabinets, countertops, flooring, fixtures, appliances and finish materials. Then there are the emotional draws of a brand new home such as knowing you are the first person or family to fill the closets and cabinets and being the first person to sink into the spa tub in the master suite. Whatever you're looking for, make sure to perform your due diligence with respect to the builder as well as the property itself. While we have some very unique homes, Fairbanks is proud to have some incredible craftsmen shaping our new neighborhoods. If you have questions or would like more information about new homes in Fairbanks or North Pole, please don't hesitate to contact us. Don't forget to check out our Considering New Construction - A few questions to ask blog. |
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Jesse & Kathy Clifton, better known as 'The Spouses' are full time Realtors serving Fairbanks Alaska buyers and sellers. They specialize in residential real estate; new and existing construction as well as undeveloped land in Fairbanks, North Pole, Ft. Wainwright, Eielson Air Force Base and Interior Alaska. Visit their website to review the fee market reports designed to keep you updated on the local Fairbanks Alaska real estate market. Have specific questions? Feel free to contact them anytime. They would love to hear from you.
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The premier real estate team in the Golden Heart City; we provide results oriented buyer and seller representation.
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Great photos. One of my life's goals is to visit Alaska.
Jesse and Kathy,
Sounds like a housing boom is happening your way!
Actually, your prices look fairly reasonable considering it must be more expensive to get building materials to your area on a year round basis.
Who are the folks moving to your area?
Jesse and Kathy I agree with your point all real estate is local. It looks like your area is moving. I always say go where the fish are biting. My MeMe is coming. It is my second.
Glad to see another report that isn't all doom & gloom!
Very interesting Jesse. Looks like new construction is way down but the prices are holding up well. Sounds like Alaskan builders are listening to the market and not over building as they have done in Florida the last few years.
Are your homes mostly built on slabs? Are they able to build year round or is a very short period? From the pictures it looks like frame construction is prevalent?
And most important do you have a guest room so I can come up and go fishing? :)
Gary McAdams: Hi, Gary - Glad you stopped by. Come see us sometime. We love playing tour guide.
Scott Daniels Agents Earn 100% commission!: Hi, Scott - We've slowed a little but we're still moving forward. Construction starts have slowed quite a bit; hopefully enough so as to not create an oversupply.
Don Davies, GRI: Hi, Don - Building is quite expensive up here... The military has been doing a lot of work the past couple of years so subs have become used to Davis Bacon wages... now that work is slowing so they're coming back to reality a bit... that will definitely help.
Frank Rubi Louisiana Real Estate-Homes for Sale : Hey, Frank - Go where the fish are biting... I'm with you there. No worries on the MeMe... it took me a bit to write the two we were tagged for last week. I'll keep checking!
Kathy Anderson: Hi, Kathy - I'm a firm believer in "it is what it is" good or bad, but I agree... there is far too much doom and gloom being reported. There is still good news to be had.
Bryant Tutas,Broker-REALTOR(R) Tutas Towne Realty, Inc: Hey, Bryant - New construction starts have been dropping; there's a LOT of "I can swing a hammer, so I'm a builder" types still throwing stuff together. Those guys are going to take a bath. The rest of us will be ok... we just have to roll with it.
Most of our construction is block on a poured footer with a few slabs where we pour radiant heat. We also use post on pad or steel pilings where soil conditions warrant (we have a lot of unstable permafrost soils). We actually build year round; 99% of it frame with a few but growing number of insulfoam type construction. My framing crews work up until about -15 (sometimes -20) and then they call it quits but the interior and finish work goes on all year. It drives my cost up, but the interest payments are incentive enough to keep plugging along.
Now, as for the fun stuff. Anytime you want to come up and go fishing, just let us know. We have tons of room and some of the best fishing anywhere. The boss and TLW can go shop Anchorage to death and we can catch some halibut or kings. The shot below is some halibut we caught last summer... darn good eating! The last shot is of a friends boat anchored near us in Prince William Sound. (click to enlarge them)
That your photo of a boat up there is stunnigly beautiful. Is this your another hobby? Too good to be merely accidental.
And...
When you do write about it...
Send me a contact message...
I so want to see how do with it :)
TLW...ROAR!
Jon Zolsky,your Daytona Beach connection: Hi, Jon - It's somewhat of a hobby... I just happened to get lucky that afternoon. The weather was perfect, the water was as calm as I've ever seen it... all in all a great day.
"The Lovely Wife"...Broker Bryant's...Wife!: Howdy, TLW - Thanks for inspiring and commenting on the post. I'm sure your and BB's endorsement was instrumental in the feature!