| Monday, April 02, 2007 |
| Golf Course Condo News |
Myrtle Beach is losing several of its golf courses to condo and home developments. At least the plans were to do it last year. I heard that Centex has stalled on the development of Rivergrand in the old Bay Tree Golf course in Little River, and may even have it up for sale. Then I heard CENTEX was bought out! Both are unsubstantiated rumors, but from good sources.
Island Green Golf Course in Surfside was upgraded and placed some condos instead of part of their greens last year. I haven't heard if they are selling well or not. Our market is very sluggish right now, although it's a very good time for buyers to get some very good deals such as Leasebacks and lowered prices. Many of last year's planned condo projects have been cancelled, and some of the preconstruction condos have investors scrambling to sell at much better prices than the original ones. I think land and single family home sales are still doing pretty good. One in particular, Bay View Resort, has a couple of condos available from investors at prices from 2 years ago. This is a deal, too. Oceanfront, luxury, pools and all the amenities.
Actually, even the Myrtle Beach condos resales are still selling, since owners are not trying to get such high prices. We've always been half of what you'd pay for Florida or most of the other Atlantic coastal areas. And now if you're looking to buy a condo in Myrtle Beach or the Grand Strand, you'll get an even better deal.
Below is the latest press about the golf course condos at East Port. I'm sure there will be plenty more plans that stall out...
April 01. 2007 1:44 PM
Ruling stops developer from turning golf course into condos The Associated Press
A ruling by a bankruptcy court judge has stopped a developer from turning at least part of a North Myrtle Beach golf course into condominiums.
Eastport Golf Club homeowners have been fighting the redevelopment for close to two years. Their lawyer said the ruling sets a precedent along the Grand Strand and should be a lesson to homeowners to check covenants and restrictions when faced with possible redevelopment.
"It's an important decision as far as I'm concerned. The only other community that attempted to stop (redevelopment of a golf course) is Deertrack. All other golf courses have just closed in our area," attorney Patrick O'Dea said.
Judge John E. Waites said residential redevelopment is not allowed by the homeowners' deed restrictions, which say the property is for "golf course use only."
The golf course is owned by Eastport Golf Club, Inc., which is owned by Charlotte, N.C., businessman Mel Graham. He is disappointed with the ruling.
"I am however, happy for the homeowners at Eastport if indeed this is the outcome the majority of the residents really wanted. I must add that I do not believe that the leadership at Eastport understands the negative impact this will ultimately have on their community," Graham said.
Graham original plan in late 2005 was to turn the golf course into 1,100 condos. He could do so because the course was losing money. The earlier this year, Graham filed the course in Chapter 11 bankruptcy, and submitted a reorganization plan that would keep a smaller golf course but redevelop part of the property into 920 condos.
Now that he can't redevelop, Graham said he will attempt to sell the course. "Unfortunately, we do not know of any potential buyers at this time," he said.
An oversupply of golf courses has contributed to the closing of 16 other Strand courses for planned redevelopment since January 2005. Three courses at Bay Tree Plantation have closed within a few miles of Eastport, and at least two others intend to close nearby.
"There really isn't a market for selling these courses," said Rick Mendoza, attorney for Eastport Golf Club Inc. "It's going to remain closed."
Residents of the golf club are glad the condos won't be built and are waiting to see what happens next, Eastport Community Association president Don Metzger said.
"We're very encouraged that our community will be able to remain intact and continue as it now exists," Metzger said. "We hope that things can get back to normal."
Labels: golf course condos, myrtle beach condos, myrtle beach condos for sale, myrtle beach real estate, oceanfront condos, preconstruction investing, preconstruction pricing |
posted by Myrtle Beach Web Design @ 4:43 PM  
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| Wednesday, October 18, 2006 |
| Condo Insurance Crisis |
The state of South Carolina, in its short-sightedness has allowed the insurance companies to put everyone that lives along the coast in jeopardy with homeowner's insurance. Nobody really knows right now what is going to happen...it's inconceivable that they will allow the companies to go up on our premiums 400-700%. But unless they can find a way to fix things, that's going to happen.
North Carolina has always had an elected Insurance Commissioner, and he could make the insurance companies jump and do tricks like trained dogs. If you called the commissioner's office with a complaint when you had problems collecting on an accident or something, you'd get a phone call several hours later from the offending company begging your forgiveness. I witnessed this twice myself, and it was amazing.
I was in Miami in June, and overheard CNN down there saying that the insurance companies had put in for a 100% increase on property insurance in Florida, and their insurance commission had granted them a 50% increase instead. That's how much pull they have, and the way it ought to be. South Carolina evidently has no such control, and they'd better get it, otherwise our condo insurance is going to ruin Myrtle Beach and the rest of the coast in South Carolina. Myrtle Beach Condo sales will be in deep trouble.
Here's the latest article about the condo insurance crisis...
Posted on Wed, Oct. 18, 2006
REAL ESTATE
Lawmaker airs plans to lower insurance
JENNY BURNS
State Sen. Dick Elliott, D-North Myrtle Beach, says he's working on legislation to keep insurance rate increases from driving Grand Strand residents from their homes.
As insurance costs continue to skyrocket, homeowners are finding their insurance bills are increasing as much as 600 percent to 700 percent, especially those living in condominiums.
Elliott said his insurance legislation will:
Require companies to operate in all parts of South Carolina, not just "cherry pick" certain areas.
Propose a move of the wind pool line to the Intracoastal Waterway from U.S. 17 Business.
Set up a statewide self-insurance pool where prices would be driven by losses within that pool.
Propose that the state insurance director become an elected position.
"In states where they have an elected insurance commissioner, insurance is cheaper, more available and there's a more stable insurance market," Elliott said.
Eleanor Kitzman, director of the S.C. Department of Insurance, said in late August she would move the wind pool line but no action has been taken, Elliott said.
Kitzman has the authority to move the line in an emergency.
Elliott is working with Senate President Pro Tem Glenn McConnell, R-Charleston, and Sen. David Thomas, chairman of the Banking and Insurance Committee, on preparing this package.
Elliott said all have agreed it's critical that insurance issues be a "front burner" item in January when the legislative session begins.
While these proposals may not immediately solve the problem, Elliott said they are a start towards a long-term stable insurance market.
Realtors say the insurance crisis is especially hurting the condominium market, forcing owners to sell and making it more difficult for buyers to afford to purchase the condos.
Elliott said the problem will also hurt the lending industry, which requires that a buyer have insurance before it can approve a mortgage loan.
The senator said he's seen "good times and bad times come and go" but he hasn't seen anything that could hurt the coastal economy as much as the current insurance crisis in the past 10 years.
Contact JENNY BURNS at 626-0305 or jeburns@thesunnews.com.
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Dick Elliott is the Elliott from Elliott Realty, which is one of the biggest companies that handles Myrtle Beach Condos - Rentals and Sales. He's got a big stake in the problem, so maybe that will make him even more likely to do something about it.
real_estateLabels: beach property, condo insurance, condos, myrtle beach, oceanfront condos |
posted by Myrtle Beach Web Design @ 6:39 PM
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| Friday, May 20, 2005 |
| Banks offer letter of credit to finance 2nd homes |
Banks offer letter of credit to finance 2nd homes
Thursday, May 19, 2005By Kemba J. Dunham, The Wall Street Journal
Buy beachfront property! Almost no money down!
More investors prowling some of the hottest real-estate in the country have discovered an old-fashioned financing tool -- the letter of credit -- and are using it in a way that may be adding fuel to an already overheated housing market.
Regional banks active along the Gulf of Mexico, where thousands of luxury condominiums are planned, are offering letters of credit to high-end home buyers, who use them instead of a cash down payment to reserve condos before they are built.
A person who obtains a letter of credit is promising to make a future payment, or else the bank that wrote the letter of credit is on the hook. Some letters of credit are secured by the person's assets; some aren't. They have long been used by companies, often when there is a lag between striking and closing a transaction, such as in securities transactions or the import/export business.
Using a letter of credit to buy a home has been rare -- until now -- in beach communities in Florida, Alabama and Texas, where baby boomers are buying second homes. Estimates call for 20,000 condo units to be built in Florida and Alabama alone in the next two years, many at prices of $500,000 to $1 million. Some commercial lenders won't advance construction financing for condo developments until the builder "presells" at least 60 percent of the units, even though they may not be built for a couple of years.
For customers who don't want to tie up cash that long, the letter of credit is attractive. "You're not using any of your cash, and protecting your cash is one of the most important things to an investor," says Kathy Martinez, who has been investing in real estate for 25 years and currently owns eight condos and seven preconstruction units along the Gulf Coast.
In Alabama, buyers are allowed to use a letter of credit for as much as 20 percent of the down payment. In Florida, a buyer can get a letter of credit for half of a 20 percent down payment; the rest must be in cash.
How letters of credit get used to buy condos is fairly simple. Typically, a developer "presells" by letting a buyer reserve one or more units with a small cash payment. The buyer then has 30 to 60 days to get a letter of credit covering up to 20 percent of the purchase price. Once the developer gets the letter, the deal is binding, and the reservation becomes a sale. The buyer may then get back that initial cash payment.
Ms. Martinez recently received a letter of credit from Vision Bank in Gulf Shores, Ala., for 20 percent of the value of a $460,000 condo there. Like other investors, she hopes the property will appreciate by the time construction is complete, allowing her to sell for a profit -- without spending anything but the letter-of-credit fee charged by the bank. Such fees are in the 1 percent-to-3 percent range of the letter-of-credit value per year.
Helga James, a Gulf Shores mortgage broker, says "everyone makes out" with letters of credit: Banks get fees and customers, buyers get to invest their money elsewhere while waiting for construction, and developers are assured their money.
Some say letters of credit make it too easy for speculators. Economists estimate about 20 percent of residential property sales involve investors, not families or individuals who plan to live in the home. Such purchasing could be artificially lifting prices and demand and could destabilize a market should speculators start dumping homes, these economists fear.
"If these letters of credits are being given in markets that have a high share of investor purchasing, then it seems speculative, and it's something I'd pay attention to," says Doug Duncan, chief economist at the Mortgage Bankers Association in Washington.
The banks believe waterfront property is unlikely to lose value, and they see letters of credit as a way to attract high-end clients amid competition from the nation's biggest residential mortgage lenders, including Countrywide Financial Corp. and Wells Fargo & Co.
Offering the letter of credit "has been very profitable for us and has allowed us to build relationships" with wealthy clients, says Danny Sizemore, chairman and chief executive of Vision Bank. Mr. Sizemore says the bank manages its risk, requiring that customers have equity in an existing property, cash in a certificate of deposit or other assets.
SunSouth Community Bank in Destin, Fla., a division of the Bank of Bonifay, Bonifay, Fla., is issuing an increasing number of letters of credit. The most popular type, an unsecured letter, requires no collateral, but the customer has to have a good credit score, a stable job and income and between one half and two times the letter-of-credit amount in stocks, a CD or in a checking or savings account. Most applicants qualify, but because of strong demand, "we have reached our cap for unsecured credit," says Jayce Holley, a vice president at the bank.
J. Collier Merrill, a developer in Pensacola, Fla., says banks do a good job with letters of credit, and the market does the rest. "We do have a lot of investors on our rolls right now, but there are enough baby boomers out there who are going to want condos here for at least another 10 to 15 years, and they're going to buy from these investors," he says.Labels: condo sales, mortgages, oceanfront condos, real estate investment |
posted by Myrtle Beach Web Design @ 5:59 AM
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To speak with a condo expert in Myrtle Beach, please call David O'Connell at 843-455-5500, or visit our new (and ongoing) website, 
