St. James Plantation near Southport, NC, features four golf courses (The Reserve by Nicklaus Design is pictured) and home site prices that begin in the low $100s.
In the current economy, investing in anything seems something like that game at the state fair where you toss ping pong balls at a bunch of milk bottles and hope one drops. In the wake of bailouts, bank stock prices and Madoff, even "safe" investments don't seem quite the sure things they once were. But one thing we can safely about real estate is that prices will stabilize and trend upward again; it is just a matter of when.
I have been looking at golf-related real estate for dozens of years and have operated the HomeOnTheCourse advisory service for five years. In that time, I have worked with couples to help find them the golf community that best suited their lifestyles and golf game. Along the way, I have encountered many important questions about the golf community market. Here are a few questions -- and my responses -- that seem particularly relevant in the current market.
Q. Is now a good time to invest in property in a golf community?
A. It depends of course on personal circumstances. If you have equity in your primary home, are retired or about to retire, and have planned to move to a warmer climate, there is no reason to wait for the real estate market to
Q. I am 10 years from retirement. Should I consider buying now?
A. Again, it depends on personal circumstances but one thing to consider is a hedge against price rises in warm weather areas by purchasing a home site now, while developers and over-extended private owners are hungry and prices are at their lowest in five years. Last year I helped two customers find and purchase lots in Ocean Ridge Plantation (Sunset Beach, NC) and at the Governor's Club in Chapel Hill. They don't expect to build a home for a few years but they were able to purchase nice home sites for excellent prices. Just be careful about costs of ownership beyond the lot and the taxes on it (for example, some communities make golf membership mandatory at the time of purchase).
Q. Should I buy a developer lot or a re-sale lot?
A. You should buy the lot that best suits your vision for the home you will eventually build. However, here are some rules of the road. First, re-sale lots are generally lower priced than developer lots, although there are exceptions. Developers do not like to lower their prices for fear of alienating other owners who paid more just a few months earlier. However, those same developers are willing to add incentives to sweeten the deal, such as free or reduced-price golf membership or attractive financing terms. Second, some community sales offices won't tell you about re-sale lots; their developers insist that they push the developer lots. In many cases, you will need to engage a local real estate agent to inspect the re-sale lots; and in a few cases, developers make things difficult for the agents to show properties. If a developer prevents you from seeing re-sale lots, move on to the next community.
Q. How do I know if a development is stable?
A. First, consider the developer's track record. Has the organization lived up to its commitments to its property owners over a long period of time (at least more than a decade)? Does the developer have strong
Q. Should I consider a vacation home instead of a lot, even if I won't relocate for some years?
A. Some people do this, but don't expect to defray all the costs of the home by renting it. If you rent the home a week at a time through a local or on-site rental office, you will pay fees up to 40% of the gross rentals (for maintenance, etc.). The benefit is that you will have use of the home for up to 14 days a year (more if you are there to do some maintenance work, according to tax laws). Even at just two weeks a year, you can get a taste of what it is like to live in the community and, over time, either assure yourselves you have made the right choice or determine that another community might suit you better. Some couples, including one who purchased a home with my help in The Landings near Savannah, rent their home out on a long-term basis, which provides a more stable stream of rental income but prevents use of the home during the year.
Q. Okay, let's say I identify a community with a nice golf course and all amenities in place. What can I expect to pay for a lot or a home?
A. Of course, that depends on what community, where it is located, the quality of the amenities, including the golf course, and many other factors. Note below that the difference between a lot at, say, Reems Creek and The Cliffs at Walnut Cove, both featuring mountain views, is about $500,000. The Cliffs, with amenities to beat the band, features seven private golf courses; Reems Creek features just one, and it is open to the public. Since North Carolina includes mountain golf and coastal golf communities, I've listed a few examples from across the state. The following are a sample of current listings for home sites in communities I have personally visited and can recommend, although they vary widely. The prices generally reflect the lower end of the range in each community. All properties feature a view of the golf course. If you would like more information, please do not hesitate to contact me.
Coastal:
Brunswick Plantation, Calabash, acreage n/a, 27 holes (Willard Byrd) $94,900
St. James Plantation, Southport, 1/3 acre, 4 courses (P.B. Dye, Nicklaus Design, Tim Cate, Hale Irwin), $125,900
Albemarle Plantation, Hertford, ½ acre, Dan Maples golf, $135,000
Landfall, Wilmington, ¼ acre, 2 courses (Nicklaus & Dye), $175,000
Ocean Ridge Plantation, Sunset Beach, 1/3 acre, 4 golf courses (Byrd and Cate), $179,000
Porters Neck Plantation, Wilmington, acreage n/a, Fazio golf, $199,900
Mountain:
Reems Creek, Weaverville, 2/3 acre, Hawtree & Sons golf, $99,000
Laurel Ridge, Waynesville, ½ acre, Bob Cupp golf, $139,000
Champion Hills, Hendersonville, 1.6 acres, Fazio golf, $160,000
Cliffs at Walnut Cove, Asheville, 1¼ acres, Nicklaus golf, $595,000
Tomorrow: Examples of homes for sale in North Carolna golf communities.
