THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Saturday, October 29, 1994 TAG: 9410270365
SECTION: REAL ESTATE WEEKLY PAGE: 16 EDITION: FINAL
COLUMN: About the Outer Banks
SOURCE: Chris Kidder
LENGTH: Long : 107 lines
Few would deny that the Outer Banks needs affordable housing.
The average resale price of a beach cottage is nearly $150,000, well beyond the means of the median beach family's annual gross income of less than $37,000. The average price of new construction is even higher.
According to figures released this month by the Outer Banks Chamber of Commerce, the cost of housing in Dare County, fueled by second home, investment and retirement markets, is 36.2 percent above the national average. Dare County housing is North Carolina's most expensive.
Our incomes, meanwhile, are relatively low and below the state average. Tourism, our primary industry, fosters hundreds of low-paying jobs in restaurants, retail stores, motels and other service businesses.
A few sales agents, building contractors and others in real estate-related businesses earn handsome livings but most workers barely make ends meet.
In fact, many local workers have given up on owning a house. When they see 20-year-old, drafty beach boxes in noisy neighborhoods selling for $85,000 with 20 percent down, they throw up their hands in desperation and dig deeper for the next month's rent.
But a couple of Outer Banks builders are trying to make homeownership affordable for first-time and lower-income buyers.
BC Realty & Construction, Kitty Hawk, has focused on the ``affordable'' year-round market with Collins Creek in Manteo.
Because Collins Creek lots have city water and sewer service, they can be small: average lot size is 5,000 square feet. Less land means lower cost. Prices for 1,156 square-foot three-bedroom homes, including the lot, begin at $79,900.
While small lots keep prices low at Collins Creek, Bob DeGabrielle & Associates has taken a different tack with his new subdivision, The Pines of Grandy.
DeGabrielle is building 1,200-square-foot homes on 32,000 square- foot lots with prices starting at $80,000. The price break here comes from location: Grandy, on the Currituck mainland, is 20 minutes (in light traffic) from Southern Shores.
There's no question that many folks view the Grandy location as a liability. Traffic jams at the Wright Memorial Bridge on summer weekends should be alleviated with the opening next spring of the new span, but the long-term prognosis for easy beach access during peak season is still grim.
There's the fact that people who work at the beach usually do so because they like living at the beach. Living in Grandy is just not the same.
But Grandy is a small, unincorporated community near the shores of the Currituck Sound with charms of its own. Property taxes are only 62 cents per $100 of assessed value.
Currituck County schools are some of the state's best rural schools. Food Lion and Hardee's are evidence of the community's potential for growth.
And the mid-county bridge - wherever it makes landfall - will give Grandy's residents better access to the Currituck beaches.
Large, heavily-wooded lots are The Pines of Grandy's saving grace. The nine-lot subdivision is on a dead-end ``T'' one block off the highway. Adjacent land fronting Route 158 is zoned commercial; a hodgepodge of housing, including mobile homes, abuts the other side. With all those trees, you hardly notice.
DeGabrielle builds a well-designed, maintenance-free home that meets North Carolina Power's Energy Saver specifications. His on- site sales manager, Tom Ritz, says buyers ``shouldn't have to do anything outside but cut grass.'' Both of De Gabrielle's three-bedroom, two-bath floor plans make 1,200 square feet seem like a lot more. ``The houses aren't just rectangles as a lot of houses in this price range are,'' says Ritz. ``Bob tried to give them some style.''
One model features a separate master bedroom wing with a mammoth walk-in closet separated from the other bedrooms by a great room and kitchen. The other model offers a spacious entry foyer and more formal living space.
The subdivision has protective covenants and no amenities. There is no homeowners association and, therefore, no dues. Golfers can play 18 holes just a chip shot away at Goose Creek. A more challenging course is being built less than 10 minutes down the road in Spot.
Both BC Realty and DeGabrielle use the ``if you can afford to rent, you can afford to buy'' pitch to sell their developments. That's not quite true. Without a large down payment, it's hard to get monthly payments (including taxes and insurance) below $700 a month.
Even on the beach, you can rent a decent house for less than that.
And the cost of owning a home doesn't stop with the mortgage payment. Buyers must have money available for repairs and upkeep - expenses most renters don't pay.
But if you can afford $700 or $800 a month, you may be able to purchase one of these homes with low or no money down financing. Cooperative Savings Bank, Kill Devil Hills, offers 100 percent financing to first-time home buyers through a federally-backed program (FmHA) and 95 to 97 percent financing for other qualified buyers.
For example, a couple without dependents could buy a $82,000 house with no money down, 8.75 percent interest and monthly payments of $720 (including taxes and insurance) if: their combined annual income is at least $29,800 but less than $32,300 and their other monthly debt (charge cards, loans, child support or alimony) is under $300.
First-time buyers may see additional savings at tax time, if switching from the standard deduction to itemized deductions allows them to deduct their mortgage interest. Be forewarned: Mortgage interest isn't nearly the break it used to be. Don't count on tax savings until you've talked with your accountant.
For more information about these new homes and available financing, call: The Pines of Grandy, 919-473-2298; Collins Creek, 919-261-5050. MEMO: Send comments and questions to Chris Kidder at P.O. Box 10, Nags Head,
N.C. 27959.
by CNB