this article from CNNFn.com today, titled: “Is Nesting the new Flipping?”
“By Les Christie, CNNMoney.com staff writer
NEW YORK (CNNMoney.com) — If flippers were the poster children of the real estate boom, then nesters are becoming the icons of the new housing market.
“We saw a nesting reaction after 9/11, but we’re seeing a stronger nesting reaction now,” said Bob Peterson, president of ABD Design/Build in Ft. Collins Colo. People who have the money are fixing up what they have.”
A proportionally bigger share of the home construction dollar — 20% more during the first three quarters of 2009 compared with the same period last year — now goes to home improvements, according to the U.S. Census Bureau. In October, remodeling spending increased 8.7% compared with September to an annualized rate of $114 billion.
Jeff Hunt, vice president of Houston-based Brothers Strong remodelers, said that after a long slow period starting early last fall, his business took off. “About Aug. 1, all the stuff in our pipeline broke loose all at once, and since then we’ve been so busy we can’t see straight.”
Most of his projects are for nesters planning to stay. “Many people consider buying to get more space but when they look at all the costs they figure it makes sense to stay put,” said Hunt. “They say, “I like my house, my neighbors, the schools.’ Of course they do. That’s why they bought the house in the first place.”
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All many want is more space. Like Kim and Sandy Sobieski, clients of Hunt in Cat Spring, about 50 miles west of Houston.
The semi-retired title company exec and his wife have plenty of room to expand, and they love their land. “We have 65 acres and we didn’t want to give that up just to buy a bigger house,” said Kim Sobieski.
Hunt’s company converted Sobieski’s garage to an entertainment room and finished out its second floor. He also built a new garage and updated the kitchen, doubling its size. The job, which included a new roof, cost about $300,000 and added 1,500 square feet.
“It’s very upscale, very nice,” said Sobieski. “It’s got a whole big room just dedicated to my wife’s quilting.”
Signs of life
Projects like the Sobieskis are happening all around the nation, helping to push the latest National Association of Home Builders’ (NAHB) Remodeling Market Index higher during the last quarter.
Perhaps even more significant, NAHB’s future index also jumped, indicating that home re-modeler confidence has strengthened. “The phones are ringing more,” said Rose Quint, an economist with the NAHB. “That’s led to a nice increase in the future indicator.”
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