Flash player is required to view weather conditions. Download

site web  

The once strong foundation of the housing market has been crumbling along with the U.S. economy, forcing some home builders to close up shop. Others have been forced to find new ways to build back their customer base.

In Butler County, home sales have dropped 21 percent as of March compared with the same period last year, according the MLS of Greater Cincinnati.

But new home construction permits have taken a bigger hit, falling 41.5 percent in the county, according the Home Builders Association of Greater Cincinnati.

Much can be blamed on the struggling economy coupled with a beaten credit market, which still is recovering from the subprime market meltdown, said George Vredeveld, professor of economics at the University of Cincinnati.

"It's going to take this market a while to figure out how to come to grips with the problems, sort them out and take one or two steps in right direction," Vredeveld said.

But while the economy tries to bounce back, builders have been closing shop.

Ryland Homes announced in April it will begin shutting down its operations after reporting a $29 million loss in the first quarter of 2008.

Ryland has offices in Mason, with a total of eight developments in Hamilton, Liberty Twp., Batavia, Morrow and Turtle Creek Twp.

In February, Beazer Homes announced it would begin shutting down local operations, and Ryan Homes shutdown its Lebanon sales office in September 2007 after deciding to cease construction in six area communities.

A new strategy

As costs continue to soar and sales plummet, one area company said it has found the means to flourish.

Caroline Rofles, an owner of Meridian Mark Management, said her company has been diversifying the types of homes they built. As a result, her three home building divisions — Potterhill, Charleston Signature and Holiday Homes — are poised to have their best year in history.

The secret? Rofles said consumers are turning to "green homes" to help keep money in their pockets.

"We're one of the only green home builders here. Since energy prices have gone berserk, people are paying attention to how much money they can save by building an energy efficient home," Rofles said.

"Owners can save up to $75,000 or more over (the) life of (a) mortgage by saving on energy, water and special loans programs for houses with superior energy ratings."

In general, green homes are more energy efficient, use environmentally friendly products and have better indoor air quality, Rofles said.

Manufactured homes, which are built off-site and then shipped to a land lot for final construction, have also been boosting sales, she said.

"They are doing very well right now because they are very affordable. It's important to have options for people who are looking for a good value right now," Rofles said.

Building back the industry

One reason figures are not showing a miraculous market comeback is because area housing sales are being compared with figures that just can't be matched, said Dan Hendricks, executive director of the HBA.

"Growth in Liberty Twp. and West Chester Twp. was hot for a while, and we knew they wouldn't be sustainable," Hendricks said. "If you look at those areas now, there is a lot of inventory. The market needs to correct itself, burn through the inventory before it can correct itself."

Meanwhile, Hendricks said for builders to survive they have been taking in new business and strategies.

"Our builders are being a little more savvy, adjusting business plans for the market, doing more remodeling and commercial work," he said. "Some of the changes they have made now, when the market does come back, will be permanent changes because this process is teaching them to find better strategies."

Hendricks said in the meantime, buyers need to take advantage.

"Statistically in the region, unemployment is not that huge. In this region, even though there is more unemployment than there was, historically it is not terrible. Prices are low and credit is still available," Hendricks said.

Vredeveld agreed, but added

residents should not be pressured into making a bad decision due to a good market.

"You ought to buy a house or build a house because it makes sense for you. You don't do it because prices

are lower than they will ever be," he said. "If it's a timing issue, its not a bad time. I think buyers have an advantage. Interest rates are quite low. And it looks like a pretty good time to me."

Contact this reporter at (513) 705-2843 or jlander@coxohio.com.

Vote for this story!