|
Most
purchases at Eagle Crest Resort fall into one of the following
categories. There is a secondary market for timeshare sales also.
A. Permanent home.
B. Permanent home in Active Adult Community.
C. Income second home, townhome or chalet.
D. Second home, townhome, or chalet not on property management.
E. Private party purchase of lot for a spec home.
F. Builder purchase of lot for a spec home.
G. Private party purchase of lot for long term investment.
H. Fractional purchase for income and/or personal use.
Let
me share some of my thoughts on each of these considerations and you
will see that I'm not necessarily an advocate of a couple of them.
PERMANENT
HOME: Several hundred couples, mostly living without children, are
permanent residents at Eagle Crest Resort, staying 6 to 12 months a
year. There are three viable approaches to owning a permanent home
here. Retaining your own builder obviously allows considerable input in
personalizing the home. This usually requires a leisurely approach to
your occupancy date as the lot purchase, plan design, submissions for
Architectural Review Committee and permits may take 2 to 5 months in
itself and then a 6 month, more or less, construction period can add up
to a year long process. Re-sale lots are priced from 235,000k to over
500,000k with size and view privileges dictating the asking prices.
Many sellers are willing to negotiate their lot price and generally, if
inclined, place a value to the purchasers on a lack of financing
clause. Many sellers will not negotiate their price at all, especially
early in the listing exposure. If a lot seller has a balance owing,
he is generally compromised from carrying a balance by his lender
requirements. An effective finance avenue is often a line of credit as
it normally gives a purchaser a lower and often a deductible interest
rate and the leverage of a cash offer as opposed to an offer contingent
on financing. Many families rationalize these processes and time frame
and often will rent a townhome or private home on site during the
construction process if their own home has sold. There's usually a
fairly good market for a long term rental here; rentals are around
1200 to 2000 per month, depending on whether it is a townhome or
permanent home and the season. A second option is for families who
need a home in a short term, but desire a newly constructed home. There
are usually some vacant builder spec homes available on the resort.
Also, a good selection of secondary market re-sale homes would
typically be available to preview. Homes are in the 450,000 to
1,100,000 range with some higher, of course. Very few homes are less
than 1800 square feet as that was the minimum requirement for almost
all of the developer offered lots.
PERMANENT HOME IN THE
ACTIVE ADULT COMMUNITY: The exclusive builder of the Active Adult
Community is C-Corp (Chuck and Caroline Koon). C-Corp has approximately
14 floor plans ranging from 1600 sq ft to 3500 sq ft and recently
finished their meeting/reception facility. The basic criterion for
ownership in the Adult Community is one member of the family must be 55
years minimum age (and the kids can only stay for limited periods of
time).
INCOME SECOND HOME, TOWNHOME OR CHALET: The permanent
income home, as opposed to the income townhome or chalet is a tough
one, I feel. There are some successes in short term renting of a single
family home, but this is generally because the owners put in a lot of
effort themselves, as opposed to relying on property management
entities. Vacationing families prefer a townhome or chalet because they
are renting in a neighborhood of other vacationing families. Income
statements for specific listed 2,3 or 4 bedroom townhomes or chalets
can be forwarded to you. Property management takes the promotional and
maintenance effort totally out of the owner's hands. An excess of
$13,000 has been the annual income for some properties after the split
with Eagle Crest Property Management, but keep in mind, these are
usually mature properties where the owner does not take an excess of
prime times for personal useages. Eagle Crest Property Management has
very enlightening materials that they may offer you on request that
will show their requirements and benefits to you as a vacation property
landlord. They allow us access to these printed materials asnd we will
pass them to you on request. Furnishing are often included in a final
purchase price or can be negotiated outside of the sale.
TOWNHOMES
OR CHALET NOT IN PROPERTY MANAGEMENT: Some owners do not wish to rent
their townhome or chalet out at all. This will be indicated in a
listing agreement. There is no mandate that Eagle Crest Resort requires
that they be selected for property management and you may choose
another source, manage it yourself or choose that it remain vacant
except for personal use. Several exchange associations have processes
for giving daily or weekly credits in their resorts in exchange for
usage in an owner's townhome or chalet.
PRIVATE PARTY PURCHASE
OF A LOT FOR NEAR FUTURE CONSTRUCTION: This is prudent and
motivational. You have your site and probably have time to carefully
explore who your contractor will be and what you wish to build there.
You will have some immediate ownership benefits such as use of the
facilities and various discounts, some of which will apply to immediate
family members with certain age and residence restrictions. You may
wish a copy of Architectural Review Committee criteria. With Eagle
Crest's blessing, I will pass them along to you or give you access to
the people at Eagle Crest Resort who will do the same. Again, I will
counsel you as to what I have seen over the years as prudent
construction on your site and caution you if I and others feel that a
home is over-building or under-building for your location. Information
on all lots currently on the market with Central Oregon Multiple
Listing Service (MLS) is available to you on our Eagle Crest Lots link,
plus directional maps, on request.
BUILDER PURCHASE OF A LOT
FOR A SPEC HOME: There is a good bit of this type of activity at Eagle
Crest Resort. Builders are motivated by price & location. I will
become quite involved as to what should appeal to the marketplace and
where certain types of homes should and should not be sited. For
example, if you love two story homes, you must be very careful as the
market re-sale percentages are not in your favor. If you need a
subordination of the deed, you probably won't get it. The lower priced
homes move very well compared to the active, but highly
competitive 550,000 to 750,000 range.
PRIVATE PARTY PURCHASE
OF LOT FOR LONG TERM INVESTMENT: Sorry, I'm not a great fan of this
purchase. I've seen some wonderful inflationary trends on occasion,
usually on lots that have mountain views, greenside locations,
cul-de-sacs or all three benefits. But when you consider that offered
financing is often not deductible, ongoing taxes, maintenance fees and
usually a brokerage fee down the line when you wish to sell, then it
takes an unusually high inflationary spiral to offset these costs and
still make a speculative profit. Certain properties function in areas
that a lot doesn't. Structures usually offer deductible interest and
expenses. They gain rental income. They can be exchanged for other
resort accommodations. They keep you from spending after tax dollars in
some hotel/motel if you're staying in your own place instead. They're
pretty nice for special gifts of time to friends and relatives. So,
long term holding of lots, as opposed to long term holding of a
functioning structures just doesn't make a lot of sense to me unless
you are very, very fortunate in your timing. Buying the lot a year or
two prior to building on it , conversely, is a wise choice as opposed
to holding and paying for the lot for 5 or 10 years and hoping for a
profitable outcome. Just my opinion, of course but this is an area
where I have not benefited from in my personal purchases in most
cases. Converesely, the last year has proven to be highly inflationary
and exceptional lot increases in values were experienced. The
continuation of that recent inflationary trend has been questioned by
people with more credentials than I. We'll soon see.
FRACTIONAL
PURCAHASE FOR INCOME AND/OR PERSONAL USE: Fractional purchases offer
many benefits and the market now offers many very good opportunities
for re-sales. Many owners have outgrown the use benefits that
originally motivated them and ongoing maintenance fees motivate some to
sell for quite a bit less than the original purchase price. Most
fractionals are 5 or 10 week ownerships in a specific townhome or
chalet. There are some income opportunities here, but most successes
are where the owner advertises or rents the property outside of a
property management entity. I've limited my involvement in fractional
sales except for those owners who are willing to hold a trust deed for
5 or so years with a small down payment. Financing them is a problem
except for a line of credit type of loan. There is a very good
selection of this type of property, some with garages, golf views,
river views and some excellent pricing.
I have made references
to tax consequences on occasion, but am without credentials. Please
inquire of your tax and/or legal counsel about the ramifications of any
real estate purchase as it relates to your personal situation.
Other
items of interest available to you may be various association budgets.
Please inquire for a specific product budget and we will forward it to
you.
Assistance on accommodations is available also.
Sometimes we can save you a fair amount of rental outlay because of
personal associations. Sometimes we cannot, because of the time and
demand of the year.
|
