In June 2007 I was checking out new communities in Gilbert, and looked into Stratland Estates. I thought it looked like a neighborhood in trouble with too many specs. A check of records at the Assessor’s office showed five sales at the time.
Stratland Estates sounded wonderful on their website- here’s how the builder describes it:
This beautiful community not only offers excellent homes, but an inviting and lovely outdoor atmosphere as well. Our impressive water feature entry previews the boulevard, tree-lined streets and lush landscaped common areas. Nestled in the center of the community is a beautiful lake and community amphitheater perfect for social events and family get-togethers.
I asked M what he thought. Here’s how he described it last June after he took a look:
Stratland opened July 24, 2006 and finally has five sales. New Home Builder Search showed they have twenty (20) specs which seems awfully high for such a new and small sub. Upon entering the sub the landscaping is still not completed, the amphitheater is a nice touch but surrounded by barren dirt. I saw homes that were in various stages of completion…………….indeed there were 20 homes with red signs in the window simply stating "Available" . There were a few half-finished homes that had "Sold" signs in the front yard…I’m not sure if they ran out of "Available" signs or the buyer’s just had not cancelled yet.
As for the 5 homes that have sold, 4 were bought Billy and Karen Littleton. A quick search indicates he was Designated Broker SunWest Communities which is now called Stratland Homes.The last sale went to James Bovino who just happens to be the Chairman and CEO of Stratland Homes!
Well, let’s hope the first retail sale closes soon……..Stratland can’t have that many employees!
Here it is 21 months after Stratland Estates opened, and M visited them again- this time with his camera. We’ll let the pictures tell the story….
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Sales Office
New Model Home Center for mid-level homes
The weeds are taller than the plantings
M states:
I would guess that about a dozen homes are occupied……………….for now.
My question to M last summer:
"I’d be real nervous in there as an actual buyer- how do you run an HOA when there are only a couple of you in the neighborhood? Take turns mowing the common areas???"
A Notice of Trustee’s Sale was filed against Statland Estates on April 7th of this year. Perhaps we are about to find out what happens.
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I’ll edge, you mow. We can both sweep the sidewalk.
Who pays the property tax on the common areas? Ouch.
I will bring a machete and hire a guide.Looks like there is lots of wildlife.
The more relevant question may be “how do you FUND an HOA when there are only a couple of you in the neighborhood?”
My HOA’s last newsletter indicated due to the high foreclosure rate and resultant uncollected dues, we are in a deficit, and the board may have to arbitrarily increase the monthly fee the maximum amount allowed by CA law without a majority vote – 20%.
TemekuT-
A point well taken. I was drafted to be on the board of our homeowner’s association about 10 years ago- and I was shocked how expensive it was to run an HOA. We had 270 homes, a park and a lot of greenbelts- and an operating budget of close to $200K/year.
If I were in the market for a new home, I’d stick to neighborhoods near buildout. As you indicated many communities are having budget problems with all the foreclosures, but at least there is more safety in numbers.
Just curious…Does anybody know if Roundup (the weedkiller) come in 50 gallon containers?
They need a 55 gallon drum of Ortho Ground Clear.
???McFLY??? Seems to me there is a ready-made solution for this: give a landscape guy free rent in one of the homes and set expectations for keeping the neighborhood clean.
Ahhh…
Reminds me so much of California living.
Glad I got the heck out of there.
Flash forward 3 years to see this place as a ghost town
In addition to the weeds, the houses are ugly, too.
If only a few houses have been sold, the HOA generally remains the responsibility of the developer. It is generally not until at least 1/2 of the homes have been sold that the HOA is “turned over” to the actual homeowners. I am not an expert on Arizona law, and as such I don’t know its particulars on its duties to leave sufficient reserves, the condition of the common areas, etc. But there may be a recourse legally against the builder (the value of the remedy may be negligble however if the developer is down the tubes).
The other thing is, yes you do take turns, or you place a lien on the property. That lien doesn’t go away, and stays with the property. Eventually there will be a recovery, the houses sold, and money obtained.
I grew up in a neighborhood that was only 1/2 full. 20 years later all of the lots STILL have not been built on (tho only 2-3 remain vacant of the 30 homes). There were weeds, dirt lots, it wasn’t so bad.
This community looks bad. All the more reason to research.
Small builders doesn’t necessarily mean bad. It just means you need to do your research. For most builders all the subs are going to be the same anyway.
Hilarious. I can picture the HOA meetings (if they happen at all) … a couple of angry, dispirited people pointing fingers at each other.
If I lived there, I wouldn’t mow… I’d till and plant a little something. Hey, better than weeds, or just spraying poison everywhere! Why are we so quick to destroy nature when it’s not a tiff lawn?
Of course, if I lived there, I’d be home now.
Just sayin’.
You know, and maybe M can back me up here, I’ve seen this a LOT with the homes between Pecos and Queen Creek between Val Vista and Power Roads.
I live just west of VV on the corner of VV and Germann and this neighborhood is doing fine.
But everything EAST of us up until Power Ranch seems to have been built with the expectation that the market would go UP for at least another 2-3 years while they got their infrastructure together.
If you go to Craigslist or look at the MLS for Gilbert there are TOOOONS of homes around the Higley+Germann area. If you drive there, it’s a mess. No stores, no gas stations, total road construction, and tons of half-built homes and bulldozed dirt lots standing empty.
It’s almost like someone hit the “PAUSE” button on the sprawl out here. You can see the starting phases of all that future growth, but that area is virtually a ghost town.
I always joked with my kids when we’re in that area that there are too many flags, not enough cars.
MG-
M’s comment- “You’re 100% on the money!”
M and I have driven around the same area for years now and have come to the same conclusion. The area was built up to meet speculative demand in excess of real growth- and it’s going to suffer until real growth catches up.
Igor says “bad idea”. He’s right, it was.
agnostic-
Let a laborer stay in one of our upscale estates in exchange for free groundskeeping?!
That’s just uncouth!
It’s also the most sensible idea I’ve ever heard.
twist -
It’s always nice to meet folks who you’ve probably seen at your grocery store before without knowing =P
Another big area I’m seeing with the same symptoms is Ray + Power (ish). There’s a very high turnover of rentals in that area and William Lyon had 2 developments they were building when the bubble popped and got everyone wet. I’m constantly seeing rentals on Craigslist and listings in the MLS for the Power+Ray (or Higley+Ray, etc) area and Germann+Higley area.
Gilbert+Riggs seems to be another hotspot, but it seems less volatile over there.
This is a great time to get your funding and credit scores in order, get on a very trim budget and try to build some liquidity, and keep an eye on the local market. I’m expecting these areas to drop another 10-15% at LEAST before we see an uptick in the market values.
Also of importance is building equity on the purchase. I’ve said in another post that I’m looking to make a 75% offer on 3 houses with the floorplan I want in my neighborhood. I figure that 25% off would give me a good 15-20% solid equity to weather the flatline with.
Just because we’re not going DOWN anymore, doesn’t mean we’ll be going UP. As you’ve pointed out, twist, there’s a high likelihood that save for artificial conditions, that this market may flatline for a bit while the banks unload their inventory, builders adjust their books and future plans, and buyers start coming out asking, “Is it safe yet?”.
And by equity in the above post, I was speaking more about “money safe to be lost”.
Even if I moved in with 15% equity in the house according to the most recent appraisal, I’d consider it money that belongs not to me, but to the market. Should it drop even further, that’s the fat the market will eat for nutrition before it starts attacking my principal.
Stratland AKA Sunwest is a horrible builder who built us a dangerous defective home… We have been in litigation with them for 2 1/2 years… Stratland feels as though they do not have to follow the rules and to my absolute surprise These AZ so called agencies put in place to protect the public really protect the builder… It looks as though it is all catching up with them… The have serious problems with law suites, foreclosures ect ect I can NOT say I am unhappy about it… I hope my signs DO NOT TRUST STRATLAND AKA SUNWEST and my telling my story to anyone who would listen and my passing out flyers of JD Power 2006 survey of their record in customer service which Stratland AKA Sunwest scored a 58 coming in dead last. The average in Az is 107. I hope it do do some damage because they are a Builder with no scruples, and certainly NO REMORSE. They refuse to take responsibility for their negligence to this day.