Dose of Reality in re BRAC (Huntsville, Redstone Arsenal: sales, real estate market, 2010)

[kypeep]

Finally, today's Huntsville Times lead headline admitted what many of us have been thinking - BRAC movement is being affected by the economy. What does this mean for local real estate?

[Charles]

Originally Posted by kypeep

Finally, today's Huntsville Times lead headline admitted what many of us have been thinking - BRAC movement is being affected by the economy. What does this mean for local real estate?

Two things come to mind.

One, if the rate at which jobs come here slows down, then the rate for homes should slow down.

Two, if instead of a bunch of 20 year experience employees making $140K per year moving here, a bunch of new hires or people making $70K end up here, then the demand for higher end homes would seem to be less.

Still, in the overall scheme of things, would you rather be anywhere else than Huntsville if you are an engineer in 2009 or 2010?

[mm42]

MDA has no place to put anyone who might want to move here right now. VBII, Wynn, and Bradford are completely full. The only way they can seat new gov't people is by kicking out SETA's, which they are doing in some cases.

So, LTG O'Reilly is correct that there have been quite a few people who are not able to move because of the housing market, but the biggest factor right now is office space until VBIII opens.

Materiel Command is in the same boat, I think, until their building is finished.

[TimG]

Originally Posted by Charles

Two, if instead of a bunch of 20 year experience employees making $140K per year moving here, a bunch of new hires or people making $70K end up here, then the demand for higher end homes would seem to be less.

So true. ...From the US Army Garrison website on Redstone: "At the urging of local education and business leaders, the Army is changing some missile and aviation program contracts at Redstone Arsenal to allow hiring less-experienced engineers and executives. …The move could help fill new defense jobs transferring here through BRAC"

The local Real Estate market is being effected and there is doubt about it; sales volume is dramatically down from last year and the year before. Prices have held up, but are beginning to show consistent signs of stress across all price ranges. Inventory is still too high.

There are lots of hopeful transferees waiting on their home to sell and some are re-thinking the move all together given current economic conditions. And while some jobs have already transferred, the big push has not really begun, however the new construction on Redstone to house this activity is proceeding nicely and some of it ahead of schedule. Although a recently improved government program to buy transferees homes may help some wanting to make the move to Huntsville.

Another fact you won't hear much about: If you are a full-time real estate professional in Huntsville and 'not gaining market share' you are feeling it big-time; every time you go to the bank, buy groceries, or fill up your car.

[Charles]

Originally Posted by mm42

MDA has no place to put anyone who might want to move here right now. VBII, Wynn, and Bradford are completely full. The only way they can seat new gov't people is by kicking out SETA's, which they are doing in some cases.

So, LTG O'Reilly is correct that there have been quite a few people who are not able to move because of the housing market, but the biggest factor right now is office space until VBIII opens.

Materiel Command is in the same boat, I think, until their building is finished.

I've heard from multiple independent sources that VBIII is already full, meaning all of the seats are accounted for once it opens up. I think VBIII is something like 840,000 square feet and it will be larger than VBI and VBII combined - and they are pretty darn big. I also heard that VBIII will be the largest building in northern Alabama.





VBII looks like the butler's house.

[A&M Bulldawg]

Originally Posted by Charles

Still, in the overall scheme of things, would you rather be anywhere else than Huntsville if you are an engineer in 2009 or 2010?

If I wanted to live a good life with little effect of the recession, I would choose Huntsville anyday.

[caution]

those federal jobs will not stay vacant-- sure some of the people who wanted to move down won't, but someone will come get those jobs.... then it will trickle down to houses, etc

[kypeep]

Tim G - Curious about the "recently improved gov't program to buy transferees' homes." Is there such a thing? The article today indicated there is no program to buy transferees' homes. Maybe SESers, but not your average gov't worker, would be my guess.

Good point about the lower paid workers not buying the more expensive houses.

I am not sure the real estate folks around here have come to grips with reality. Or maybe it's just that sellers have not. I've seen homes sitting on the market for well past a year now with no lower price. Must be folks waiting for that "big bite," and they don't need or want to sell otherwise.

[kypeep]

Charles, I've been working for the gov't 20 years, and I'm still not making anywhere near $140K a year. That's SES pay (or specialty, such as engineering?) Can I work for the same agency you do, LOL?!

[Charles]

Originally Posted by caution

those federal jobs will not stay vacant-- sure some of the people who wanted to move down won't, but someone will come get those jobs.... then it will trickle down to houses, etc

"Defense employees are finding it difficult to sell their homes, said O'Reilly, "and they may be at a point where their children are finishing up high school and so they don't want to upend their family lives." "The age of the work force averages at about 46 years old," O'Reilly said."

and

"....efforts will be made to hire younger engineers and set up aggressive internships over the next few years to replace anybody retiring or who wouldn't move. "We have to do all we can to recruit younger people." "

from

Downturn slows BRAC recruiting - al.com



So, would we rather have 3000 or 4000 new people averaging $120K/year or averaging $70K/year?