THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Saturday, November 4, 1995 TAG: 9511020288
SECTION: REAL ESTATE WEEKLY PAGE: 02 EDITION: FINAL
COLUMN: About the Outer Banks
SOURCE: Chris Kidder
LENGTH: Medium: 88 lines
The value of property - or, perhaps, more correctly, our perception of the value of property - is the heart of all real estate business.
But what determines value? Supply and demand, utility, politics, social changes, current economic conditions and a dozen other things. While land itself is considered indestructible, its value is never carved in stone.
Slower to change than the stock market, but no less susceptible to the vagary of fortune, the current value of real property is not easily determined. Predicting the future value of real estate requires a crystal ball and someone to watch the front door for the bunco squad.
While most property owners understand the speculative nature of future value, they still like to kick around the possibilities.
``In 1988 I purchased an undeveloped lot at Swan Beach; in particular, the fourth row, section 1,'' writes a Virginia Beach insurance agent.
``Since 1988 the lot has appreciated in value less than $5,000. My question is: What do you think the impact of the proposed new bridge will have on the values of undeveloped property in Swan Beach?''
Swan Beach is one of several off-road communities north of Corolla and accessible only by four-wheel drive via the beach. Some of these communities have been on the market since the late 1960s; there are hundreds of lots platted and saleable but only about 5 percent have been improved.
In other words, supply, a major determinant of value in our capitalist economy, is plentiful. Without a road, without commercial development and other services, development has been very slow compared to other areas of the Outer Banks. The mid-county bridge scheduled to be built between the Currituck mainland and Corolla, won't change this. And without development, property values aren't going to move much.
A road to get traffic off the beach, whether paved or not, would have the biggest impact on property values north of Corolla, says Margaret Dyer, owner of Karichele Realty, Corolla. She's been handling off-road properties since 1991. The rental market north of Corolla is growing, but property values haven't reflected that growth yet. ``Sales prices are stable,'' she says.
Because vacation rentals have been growing in 4-wheel drive communities, improved properties - lots with houses - tend to be the best investments, Dyer says.
``I would definitely recommend building a house and getting it in a rental program,'' advises Dyer. ``It's too expensive to buy a lot and just sit on it when it could be earning rental income.''
Dyer isn't the only real estate agent advocating building as a way to maximize an off-road investment. Resort Realty, Corolla, had the first ``model home'' north of the paved road built this summer at North Swan Beach and had so much interest in the house that the sales staff worked like a tag team ferrying prospective buyers up and down the beach.
It's not the houses that sell off-road properties, though. North beach real estate agents agree that those who buy and rent north of Corolla are drawn to the area because of its lack of development. These vacationers come seeking solitude and quiet beaches.
Yet most of those same agents publicly predict the bridge will be a positive influence on the area's desirability and, ultimately, its property values.
``A lot of property owners think the bridge will have a positive impact,'' says Dyer. ``Rentals are already growing. I think the bridge will make the off-road properties more accessible for that market.''
Off the record, a couple of agents tell me they fear property values will suffer in the long run. Making the north beach a day trip from Richmond and Tidewater will turn it into an ordinary place, they say. And a bridge funneling thousands of people into Corolla faster and easier than ever before would seem to be anathema to those who like the off-road communities as they are.
Mary Ann McGoye, president of Outer Banks Appraisal Service, has been working with Outer Banks properties for more than 15 years.
``Your questions about the proposed bridge's effect on the Currituck Beaches are tough to answer,'' she says. ``To date, I don't believe it has had much . . . Until there is something actually started, I don't think we'll see much change.''
``Once the bridge is actually started, I think values in the lower price ranges will escalate the most at first,'' says McGoye, speaking of north beach properties in general.
``In the 4-wheel drive territory, it's anyone's guess. It's such a specialized market and most likely will continue to be,'' she says. ``Local brokers are telling buyers in these areas not to buy expecting huge gains in the near future.'' MEMO: Send comments and questions to Chris Kidder at P.O. Box 10, Nags Head,
N.C. 27959. by CNB