This is an interesting article about what's been going on in the gorge real estate market. Some of the homes mentioned in North Bonneville did go back to the banks and were relisted at historically low prices from $139,000-$149,000. These ones went sale pending within days. There are currently multiple sale pendings in North Bonneville. The Hidden Ridge lots are still being marketed at lowered prices.
Many Columbia Gorge homes unsold as developers misread market
Many Columbia Gorge homes unsold as developers misread market
Saturday, November 15 | 9:35 p.m.
BY KATHIE DURBIN
COLUMBIAN STAFF WRITER
Developer Mary Laufman stands on the one lot that has sold so far in the 41-lot Hidden Ridge subdivision in Stevenson. (Photos by STEVEN LANE/The Columbian)
Only four houses of 27 have sold in North Bonneville’s Hamilton Island subdivision, and at least 10 have entered the foreclosure process.
STEVENSON — Five minutes from downtown’s chic new restaurants and shops, in the hills at the north edge of town, Hidden Ridge is waiting.
Streets and cul-de-sacs, sidewalks and curbs, water and sewer lines and underground electrical cables are in place. Green retro-style streetlights stand sentinel over empty lots.
But buyers for these properties are nowhere to be found.
The 41-lot development carved out of the forest offers stunning views of the Columbia River Gorge and the mountains beyond. Its secluded lots range in size from 15,000 to 25,000 square feet.
“Who wouldn’t want to live here?” developer Mary Laufman asks.
But Hidden Ridge, like other new developments in Skamania County, came on the market between the building boom of 2004-06 and this year’s crash.
Just one lot has been sold. Developers Mary and Charlie Laufman, who do business as Cam Development, are negotiating with their lenders to stave off foreclosure.
“It just got done a little too late,” Mary Laufman said. “Nothing is selling now in any subdivision anywhere.”
Timing, it’s said, is everything. It’s a lesson that the Laufmans and others are learning the hard way as property values plummet in the meltdown of the mortgage market and the credit freeze.
In Clark County, 292 homes entered the foreclosure process in August. The number fell by half in September, to about the September 2007 level.
In Skamania County, where historically foreclosures are rare, 11 houses entered the foreclosure process between Sept. 27 and Oct. 27.
It’s a different kind of housing market in this county of 10,600. The scenery is grand but jobs are scarce and most of the work force commutes to the metro area.
Upscale houses aimed at commuters and retirees are a particularly hard sell these days — even with those million-dollar views.
One problem, says Ron Hambright, a Century 21 real estate agent who works in Clark and Cowlitz counties, is “the doggone fuel prices. They went through the roof. Coupled with the downturn in the market, areas out very far are just very difficult, even Battle Ground and Ridgefield. There seems to be a desire by people to live in close to their work.”
Unsold and undeveloped
Immediately east of Hidden Ridge, in the Angel Heights neighborhood, nine of 32 lots remain unsold and undeveloped. The Laufmans weren’t the developers of Angel Heights but they did build several houses there, including their own. All but one sold before the market plunged.
Six miles to the west, in the town of North Bonneville, sits another Cam Development project: Hamilton Island, a neat subdivision of 27 modest houses. Most are single-family residences; there are also two “townhomes,” a duplex and a triplex.
Surrounded by green space and linked to the rest of the town by footpaths, Hamilton Island offers 360-degree views that encompass Hamilton Mountain, Table Mountain and Aldrich Butte to the north, Beacon Rock to the west and the Columbia River to the south.
Just four have sold. Three others are occupied under lease-option agreements. Several have been reduced in price from $229,000 to $213,500.
Ten Hamilton Island properties were advertised in foreclosure sale notices in the Skamania County Pioneer on Oct. 22.
But Laufman said Cam Development has paid all its contractors and is working with its lenders, Sterling Savings and Loan in Spokane and Frontier Bank in Salem, Ore., to avoid auctioning the houses on the Skamania County Courthouse steps.
“They want us to go out and find buyers,” she said. “The banks don’t want the houses back. If they took them back, they’d be the largest homeowner in Skamania County.”
North Bonneville city planner Tom Jermann says it’s a shame the houses at Hamilton Island aren’t moving.
“They did a great job,” Jermann said. The houses “are very high-quality, buffered real well. For aging people that want to downsize, it filled a need.”
But the concept — greater density in exchange for open space — may have been ahead of its time, at least in North Bonneville, he said.
“These were smaller lots within a multi-family zone, part of our planned unit development,” he said. “The market is people in Portland, Vancouver and Hood River. Out here it hasn’t worked so far. It’s an untested thing in this part of the gorge.”
And again, there was the timing.
Hamilton Island “was just starting to sell and the market went sour,” Jermann said. In North Bonneville, “We were growing leaps and bounds. It came to a lurching stop this year.”
Building boom
Two and a half years ago, when the real estate market was hot, some locals worried about the “Aspenization” of Skamania County. They feared a surge of high-end development would attract upscale commuters to the recreational paradise of the mid-Gorge, pricing local working families out of the market.
“The city had not had any major subdivisions for 15 years or more, and all of a sudden, there was a boom,” said Stevenson city planner Ben Shumaker.
In February 2006, a total of 180 homes in four subdivisions and seven smaller developments were in the works in Stevenson alone, representing a 33 percent increase in the town’s housing stock.
Now, with real estate values plummeting and credit hard to come by, properties in all price ranges are going begging.
The Laufmans are caught in the squeeze. They started out as building contractors in Oregon’s Willamette Valley before they moved to Skamania County in late 2003 to take advantage of the real estate boom.
Mary Laufman recalls the frenetic land rush of 2005-06, when the company was building houses as fast as it could.
“It used to be you sold a house before you got it framed,” she said. “Ours were almost all spec homes. Back when times were good, you had to procure your financing or else you would lose your lots. We were buying four lots at a time.”
“The one thing we missed was how fast these lots would be absorbed,” said David Bennett, a principal in CAM Development until he left the company 18 months ago, “There were too many lots for the area. We did not have then, and I don’t believe we have now, deep enough pockets to ride this out.”
Bennett predicts that Hidden Ridge will be the next foreclosure victim.
“For all intents and purposes, it is complete and marketable,” he said. “But they can’t sell the lots. Ultimately, it will be going back to the bank. That’s my opinion.”
Mary Laufman bristles at that suggestion. Cam Development is working with its lenders to buy time, she said.
“The thing we all need to remember is this is a national problem and an industry issue. I think what’s going to happen is going to happen. The media preach doom and gloom. Everybody looks at the wreck on the side of the road.”
More lots coming
Skamania County has grown since 2000, adding an estimated 728 residents. There’s still plenty of buildable land, but in Stevenson, most of that land is on steep grades.
At the east end of town, immediately north of Highway 14 and the BNSF Railway tracks, developer Rick Leavitt of Vancouver has cleared and graded a hillside for the first phase of Chinidere Mountain Estates, envisioned as an 80-unit development when it is built out.
The property sits about 400 feet from the Columbia River. Lot sizes range from 7,500 to 14,000 square feet. All lots are view lots.
Leavitt chooses to be optimistic. He hopes to begin marketing the first 27 lots to contractors and individual buyers by year’s end. They’ll be sold at less than the $145,000 for which they were appraised last year, he said, and at less than lots of the same size in other developments.
“I love the property,” Leavitt said. “It’s the best view. We’ve done a lot of green things. We’ve put in a dedicated habitat conservation area and a private walking trail. It’s also designed to protect views for every lot.”
He’s well aware that properties in Stevenson and North Bonneville aren’t moving. But he says Chinidere Mountain Estates is different. He expects it will attract retirees, investors and people looking for summer homes.
“I look at the glass as half full,” Leavitt said. “Everyone can button up and run and hide. But I get inquiries every day about lots.” With proper pricing, he said, these lots will sell.
Because banks aren’t loaning money, he said, he’s also prepared to offer seller financing and discounts for cash.
“We’re going to market these to the masses,” he said.
Economy turns downward
The glut of housing in Skamania County worries Jason Spadaro less than the overall downturn in the economy.
Spadaro is the president of Broughton Lumber Co., which has applied to the Columbia River Gorge Commission to build a 245-unit resort of condos, townhouses and cottages called Broughton Landing on the site of its old lumber mill near Underwood. The project is presently tied up in litigation over the commission’s approval of an amendment to the Columbia River Gorge National Scenic Area Management Plan that would make the resort possible.
Housing units at Broughton Landing would be sold to individual purchasers. Most units would be leased for short-term stays. Owners would be allowed to occupy their units for no more than 45 consecutive days in every 90-day period under the plan amendment.
Broughton Landing is still years away from development, but Spadaro said it too could be affected by the nation’s economic meltdown.
“The current financial crisis is widespread and sweeping in all aspects of the economy,” he said. “It definitely affects banks and people’s ability to get credit for any kind of acquisition, whether it’s a residential unit or a resort development. Housing is overbuilt, there was easy access to credit, the housing bubble has burst.”
“A resort is a different animal,” he added. “But people’s willingness to own and then rent out a unit is still dependent on a strong economy and people traveling and spending money.”
One thing that would give the housing market in Stevenson a boost would be approval by the federal government of a Warm Springs Confederated Tribes casino complex immediately across the river in Cascade Locks, Ore. Housing for casino workers would be in demand in both towns. But that’s not what’s being built right now.
David Bennett, who still works as a building contractor after leaving Cam Development, is one who is thinking about lower-cost housing.
“I love the Stevenson area,” he said. “I continue to build up here. I’m trying to figure out how to get worker housing in here. I’m trying to work with the powers up here to figure out how to make housing that people can buy. It’s going to take banks, it’s going to take the county, to figure it out.”
In the meantime, he said, just about everyone involved in development in Skamania County is going to pay the price for misreading the market.
“We went in with the best of intentions, everybody threw in their best money, and we’re all going to get hurt.”
