The big builder fallout is slowly opening up opportunities for some smaller, more regionally based builders.
Such is the case with Cincinnati-based Fischer Homes, which announced today that it signed a deal with large national builder Centex Homes to acquire 300 lots at four communities in the Columbus, Ohio, area.
While the financial terms of the deal were not disclosed, Fischer said it agreed to manage the construction for 96 home buyers who had previously signed contracts with Centex. Some of the homes are in the main four communities, while others are in nearby Centex developments.
"Most of the buyers knew that Centex would leave the market," said Bob Hawksley, president and COO of Fischer Homes.
"Now, people who bought homes in those communities will know that the integrity of the community remains intact, that a professional builder is in place that will deliver a quality product, ... and there won't be vacant homes with weeds in the yards," he explained.
When asked how he thought Fischer could succeed in a situation where Centex left the Columbus market, Hawksley said Fischer Homes is more comfortable doing business in a market where the average sales pace per community is 20 homes per year.
"For the big builders to have their formula to work they have to do 500 homes in a marketplace per year, that means 25 communities, which is really hard to do in today's market," Hawksley said.
"Plus, Centex made it financially attractive to us to take the land over," he concluded.
The four communities are Claybrooke Crossing in Grove City; Sheffield Park in Galena; Royal Elm in Blacklick; and McCammon Estates located in Lewis Center. The homes will range in price from $140,000 to $500,000.
Hawksley said Fischer will use the same subs and suppliers as Centex, as well as the same supers and sales employees. He said Centex sent letters out informing the home buyers of the change a few days before news of the deal was released.
Fischer Homes closed 1,310 homes in 2006 and just under 1,000 homes in 2007. Hawksley said the local housing market in Cincinnati remains flat, and Fischer will continue to be on the lookout for similar opportunities to expand its market penetration throughout the Midwest and possibly the South.