SMN on a new community struggling in aftermath of housing bust

Adam Van Brimmer has another interesting and detailed piece about a specific sector of the Savannah housing market today in the Savannah Morning News: Berwick victim of poor timing; will be a ‘viable’ market as economy improves, Realtors say.

The real estate agents typically interviewed for pieces like this one are generally upbeat. That’s their job, to some degree — and that’s also their personality.

But the numbers that Adam cites tell the story.

After a surge of activity in the new area — off highway 17 near Quacco and Dean Forest — in the early years of this century, the “recession hit”:

Several developers and builders went bankrupt or close to it. Early buyers in the area, many of them first-time homeowners, hit that five-year anniversary where most are ready to move up in house. But values had fallen, and they either owed more on their house than it was worth or couldn’t compete with the builders on price.

Sales bottomed in 2010, with 75 sales. More than a quarter of the homes sold were repossessions. Nearly half were builder sales, and a good number of those were on homes built on foreclosure lots. The discount on most lots exceeded 50 percent, allowing builders to sell for less and still make a decent profit.

Average prices per square foot for single family homes have fallen from $118 in 2007 to $79 so far this year — a 33% decline. Townhome prices per square foot are off 40%.

There are currently 224 active listings for single family homes. Berwick appears on pace for about 100 sales this year. That means there’s still well over two years worth of inventory. Those are simply terrible numbers.

I do want to take issue with one particular line in the piece: “The opening of the new westside high school, scheduled for 2012, will make the area more appealing to families.”

Families might move for an elementary school nearby, but few families would move I think to be close to a particular high school. That’s especially true in this case because that new high school — which will be the most poorly sited public building in the entire county — is more than 7 miles away from Berwick.

There is much more in the piece.