Why Are There No Trees?

In January of 2002, Doug began his real estate career working for the Blue Green Corporation, as an on-site agent at Winding River Plantation in Bolivia, NC. They sold dirt and nothing but the dirt.

Why Are There No Trees?

When we sold a homesite (learned to never call it a “lot” because a woman would never build her Dream Home on a “lot”!!), the dirt came with all the trees, valleys, gullies and pitches. So, when it came time for your builder to prepare you dirt for your Dream Home, the additional costs to clear, level and bring in soil could have bee a few thousand to over $20,000. These costs were often overlooked in the budget and quite honestly, stretched more budgets than people would have thought.

In a response to the negative press from builders and property owners, sometime around 2013, local developers here and from coast to coast, began “wholesaling” homesites – which is the practice of preparing the homesites to the point where they are referred to as “pad ready.”

Why Are There No Trees?

To provide a “pad ready” homesite, this is what a developer must do:

  • Remove the trees from the homesite. Keep in mind that in the past 10+ years, the average homesite decreased from 1/3 acre to 1/4 acre in size, so in essences, it’s almost impossible to save trees on 1/2 acre for by the time you place your Dream Home on the homesite and make room for the driveway, walkways and porches, you really have very little dirt left.
  • After the trees have been hauled away, it is time to dig down 3-6′ and clear our the twisted roots, dead branches and vines – otherwise known as mat.
  • Once the mat is removed, soil experts/engineers will weigh in on what needs to be added, such as crushed stone, fine gravel, sifted soil and/or sand.
  • The homesite will them be shaped properly, with the center being crowned and tilted back to front, as this will allow for proper drainage to the street and stormwater system. In essence, it will look like the field at the Giants Stadium, with a slight back to front tilt.
  • Lastly, the homesite will be compressed according to local engineering standards, as the soil needs a specific PSI (pounds per square inch) in order to be built upon.

If you have yet to build your Dream Home, there is a lot to know about with regards to dirt, so be sure to find a real estate Broker that is educated in these matters and can best represent your interests. A few more items worthy or passing along to you:

  • Be sure to ask if the homesite is in a flood zone. Walk around the property and up and down the streets of all homesites and locate the closest ponds and/or creeks/rivers/streams, for water damage to your home can be life-altering.
  • Ask and/or look-to-see if the developer has installed storm water drainage. If not, then there will be swales/gullies in your front yard that collect water when it rains. Many people do no like having a lake in their front yard every time they get a hard rain.
  • Ask neighbors about drainage. Don’t be shy either, as just about everyone will be more than happy to share whatever date/info you are looking for.
  • Don’t be afraid to reach down and put some of the topsoil in your hand. If it is hard and clay like, then you either might have to pay a lot for new sandy soil or, be stuck with drainage issues on your homesite.
  • Drive out to the homesite after or during a heavy rain. If you are purchasing a homesite, you more than likely have a 30-45 day closing, so you really do have plenty of time.

If you want to get the dirt on the dirt, call any of our Brokers today, as many of us worked previously for developers/builders. If you are looking elsewhere in the country, well, at least you know enough to be dangerous.

And, don’t forget about Haley Wilson with www.PlanViewDesign.com – who has designed more award-winning homes in Brunswick County than any home designer or Architect! If you’re ready to find your homesite to build your Dream Home, then contact us at Carolina Plantations to get started today!

Are Investors Back???

Back in 2009, a proud young man from Miami called our office to inquire about the value of his investment homesite he purchased in 2006 during a developer ‘big event’ weekend. Believe he had $225,000+ invested in his 1/3 acre nature homesite. According to one of our Brokers here, the young man had also purchased some investment property in south Florida that was not faring very well and he just needed to be reassured that his NC property was still sound.

When my Broker researched the property, he asked the young man if he wanted the truth about the current status and value, and of course he said Yes! So that he had some perspective, we passed along to him that nothing had happened to his homesite in three years in terms of infrastructure (ie roads being paved, curbs, utilities, access to the homesite, etc.) and that there were no homes built yet in this section where 200+ homesites were sold to anxious buyers.

The young man seemed a bit dismayed by the lack of progress and the escalation of broken promises so he naturally asked the Broker what he felt he could get for the property if he were to put it on the market. Well, the reply was “your homesite is not worth a ham sandwich”. There was about 10 seconds of silence and the young man almost broke down in tears.

Investing in land, stocks, bonds, marriage, a business, sports or almost anything can be a nerve-wracking experience. That is why it is always good to take your time and research any investment you decide to jump into. Recently throughout the southeast a number of investment groups have been on the lookout for semi completed developments to invest in. In Brunswick County alone we had over a dozen communities that were in the process of being developed go belly up and leave the original development vacant. Some had roads and utilities while others had partial infrastructure.

In the past several months I know of several WEEKEND LAND SALES EVENTS that have taken place in NC. Homesites have been reduced to a fraction of the initial intended prices and a marketing team comes in, builds a new entrance, surveys and stakes the homesites, advertises to everyone in their massive databases, puts up a tent, brings in 40 sales agents and attempts to use the herd mentality to sell all the homesites in 3 hours.

Some of these marketing groups have been successful and some not as much as the others. The key though is not whether the group that picked this property up from the bank makes money, but whether these are legitimately good bargains. Here are some Pros & Cons that everyone might want to consider:

PROS

  • The prices are reduced
  • Basic infrastructure should be in so that you can build right away

CONS

  • When you have 100 Buyers together under a tent and 50 homesites to sell, you invariably have a herd mentality going on, and many people the world over make huge mistakes in these pressure cooker environments
  • Most of these communities have zero amenities (pools, tennis, fitness, golf, etc.), so chances are strong that most people purchasing these sites will never build on the sites
  • That translates, down the road, to the overwhelming majority of these homesites coming back on the market – which in turn means values will drop significantly as investors simply want to get rid of their investments once they know they are not going to appreciate
  • These marketing groups are not developers. As soon as they have everyone’s money, they are down the road to their next opportunity never to be heard from again.

As a general real estate Broker, I am perplexed as to why someone would risk $39,000 on a homesite in a 4 street community with zero amenities or homes built. Plus, these slick marketing groups don’t even let you know where the community is located! (Don’t ignore all the Warning signs!) Conversely, anyone today can walk into St James, Sea Trail, Brunswick Plantation, Winding River, RiverSea and numerous other communities and purchase a $35,000 homesite in a plantation that has hundreds/thousands of homes built, all infrastructure & amenities in and community activities always going on.

While our market here is doing well, just go to this link and see the number of homesites that are on the market in twenty of the leading plantations in the area: Click Here.

In just these plantations alone there are over 1,100 homesites for sale, so with our current absorption rate we probably have a 5-7 year supply.

If you are going to invest in real estate again, do like you did years ago and research the developer, builder, sales team, etc. before you make any kind of commitment. In the past 7 years the average American has removed one word from the real estate vocabulary, and that is the word “risk”. And if you don’t investigate as to how much risk you are taking on, you just might wind up with a ham sandwich one day instead of a good investment.