Now is the Time to Invest in the Outer Banks
By: Angie Brady-Daniels
It wasn’t long ago that people were complaining about the rising cost of real estate on North Carolina’s Outer Banks. “Affordable housing” for employees, teachers, and middle income professionals was non-existent. Housing Symposiums to address the problem were filled to capacity as people were greatly concerned about safe, affordable housing for area residents.
But now, as the national economy has weakened, homes on the Outer Banks are back within reach. Prices are back to the level they were in 2004. For those who have been saving and waiting for the right time to buy, the time is now.
Despite recent slowdowns in some markets, housing remains a good long-term investment, and demographic demand favors housing over the longer term.
Local housing markets rise and fall during short term cycles but tend to rise at a normal gradual pace as a long-term investment, said Myra Ladd-Bone of Atlantic Realty. When approached carefully, housing can be one of the safest investments a person can make.
Today, homes are still selling and people are still buying though not at the rate they once were.
Colleen Shriver of The Sun and Sea Team at Re/Max Ocean Realty said buyers are looking at the Outer Banks but they are afraid to take a forward step because of the less than favorable picture of our national economy painted by the media.
Real estate should be a long-term investment, a second home, a family vacation spot, an investment or a start for your future, she said. Real estate is the best investment for qualified buyers, interest rates are at all time lows and prices have come down. This is a great time locally for folks who bought prior to the price spike, they can sell for a modest profit and buy up. What they buy now will appreciate over time and with these interest rates they are investing in their future in a positive way.
Now is a great time for buyers with good credit to take action.
Bobby Harrell of Harrell and Associates said that people need to understand that the best opportunity to own Outer Banks real estate is now.
The market is at or near bottom now but it will begin to turn and prices will quickly respond to increased demand, he said. I have traveled most all of the coastal areas of this country and the Outer Banks is unique in our miles and miles of beautiful, uncrowded beaches plus from a rental/investment standpoint, I have never found anywhere close to the ratio of income to purchase price that we have on our oceanfront properties. We are within a day’s drive of a large portion of the U.S. population and I think real estate has a very bright future on the Outer Banks.
And for those who own their own home, now is a good time to remodel.
Dr. Mike Walden, Economist with North Carolina State University and Author of the Outlook Column “You Decide” said he and his wife Mary have begun a home remodeling project because of the construction slack and the number of people looking for work.
He said the attitudes of homeowners have changed dramatically in the 2000s.
In the middle of the 2000s decade, the average home was appreciating in value at more than 10 percent annually, said Walden. This caused more people to consider a home as a place to make money (investment) than as a place to enjoy living (consumption). Homeowners tapped the investment component of their homes in the form of home equity loans to finance a spending binge.
But, he continued to say that all that has changed with the housing crash of the last two years.
National indicators show housing values falling as much as 10 to 20 percent in some areas over the past year. The bottom line is that our view of homeownership has now shifted back toward consumption and away from investment.
He said buyers will look at homes more as a place to live and will remodel and make improvements to improve the consumption value - or the pleasure- that they receive from the upgrades.
Homeownership will return to its traditional roles as a source of shelter, a place to raise a family and a generator of pride, Walden said.
The most frequently planned projects are kitchen and bath updates—areas that real estate experts say provide the best return when selling a home. Other popular projects include landscaping and yard work, painting inside and out, flooring, doors and windows, and decks and porches.
One of the things this tightened economy has done is made us stop and realize the amount of waste in our homes and businesses, according to Chamber President and CEO John Bone. For the first time in years, we are looking hard at expenses and looking for ways to improve our bottom line. Whether a house is purchased as a home for our family or an investment property that we rent to vacationers in the summertime, it needs to be energy efficient.
The Federal Energy Star Program claims that the country would save $600 million in energy costs annually – or enough to light 3 million homes for a year – if every household in the United States changed one light bulb to an Energy Star compliant fluorescent light bulb. Other simple ways to reduce costs are improving home insulation, upgrading appliances, toilets, shower heads and faucets that use less water and replacing old thermostats with newer computerized models that can automatically regulate temperatures on a schedule.
Most homeowners realize that the slow-down is temporary and that demand for home purchases will be strong again. They know buyers are demanding and they want their property to stand out from the rest.
The positive side of this downturn in the economy is that it is forcing us to rethink many of our wasteful habits, to think long-term about the usefulness and cost of products in our homes, said Bone. We are more aware of our environment and the long-term effects of throw away technologies, harmful chemicals, and are more conscious of how much waste can really cost us over the years.
And even on vacation, while staying in homes that appear to have been designed for the rich and famous, people are concerned about the environment and want to do the right thing.
Tourism is arguably the world's largest industry. It generates about 10% of total world GDP (gross domestic product) and employs over 10% of the global workforce, and it's on the verge of tremendous growth, said Brian Mullis of Sustainable Tourism International. In recent years, the negative environmental and socio-cultural impacts of tourism have become obvious. There is ample evidence to support the fact that transportation impacts global climate change. Host communities face resource use conflicts, land-use disputes, and the loss of their indigenous identity and values. Pollution, deforestation, and the alteration of ecosystems can result from shortsighted tourism development.
He continued to say that a growing number of consumers are now paying attention to these impacts and are demanding more of their host establishments.
According to Geotourism: New Trend in Travel study, TIA, National Geographic Traveler 58.5 million Americans say they would pay more to use a travel company that strives to protect and preserve the environment. The majority (61%) of those who would pay more to use such companies would pay 5-10% more.
Responsible travelers are attracted to travel companies that employ sustainable business practices, and this target market represents a huge profit arena, said Mullis.
So what are Outer Banks rental company managers doing to reduce waste and respond to these responsible consumers?
The Cove Bed and Breakfast on Ocracoke Island has been recognized as a Best Green Hotel. Some of their practices include allowing guests the option to reuse towels, using soap dispensers instead of individual bar units, recycling food scraps into a compost/garden area, offering newspapers and brochures in common areas instead of each room, including recycling bins in rooms and around the facility.
In Kill Devil Hills, the Outer Banks Brewing Station became the first brew pub and the first restaurant to be powered, in part, by a wind turbine.
The wind turbine cost owners Eric Reese and Aubrey Davis nearly $50,000 but saves the company $200 to $300 per month in electricity costs. At this rate the wind turbine will pay for itself in 15 years.
But building the wind turbine was about more than economics. Reece and Davis say their movement was about educating their community and visitors about the power of wind and the potential of alternative energy sources.
It all starts with one little movement and this is the start, said Reece.
Reece and Davis say now they would like to see this grow into a community based wind farm on the Outer Banks.
We have one of the best wind sources available on the East Coast, said Reece. This is the place to see where wind power can take us.
Other community leaders of the Outer Banks are also taking seriously the requests of tourists for more interconnectivity between area bike paths, more parks to run and play, picnic tables, and more environmental programs where they can learn to care for the fragile lands of the area. Duck and Kitty Hawk recently built new community parks, the U.S. Fish & Wildlife Service doubled its walking trail at Creef’s Cut and expanded the number of bird walks and kayak trips that it offers. In 2010, there will be a new Alligator River Visitor Center. In Currituck, the new Wildlife Center offers decoy carving classes, photography workshops, and a chance to explore nature. Educational programs help locals and visitors learn to appreciate the natural, unique offerings of the North Carolina coastline.
The Outer Banks is truly a unique place, one that we all need to work more closely together to preserve, said Chamber President John Bone. Whether it is changing a light bulb, taking the time to recycle, installing solar panels on a home, or just reducing the amount of waste we generate, we can all do our part in preserving this area. The Outer Banks is not only our home but it is an investment for the next generation.
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