Concept of home is at the heart of all of our families, and therefore at the heart of all of our festivities.

After all, when surrounded by the people who mean the most to us, the place in which we gather is perhaps not as important as that we gather together at all. But the joy of having others in our home, sharing our food, company, conversation and time, brings a special sort of meaning to the holidays. LGI Homes homeowners, whether just receiving the keys to their brand-new homes or marking off the years since moving in, are all acquainted with the particular gratification that comes with having ample space to host their loved ones at this time of year. From large kitchens appointed with brand-new appliances and customized cabinets, to the dedicated dining rooms available in many plans, holidays are enhanced by the guest-friendly flow and functional floorplans of each LGI Homes house. This is because each house is built expressly to be your family’s true home.

Then, after the merriment has died down and the last vestiges of holiday cheer are packed away for next year, LGI Homes homeowners also come to appreciate the restful nights that follow. Living as they do in homes built with integrity, quality and affordability in mind, they enjoy the many benefits and pleasures of homeownership, without laying awake at night worried for the state of their home’s structure, or the size of their bank account. With affordable monthly payments that are often less than rent, their financial lives are in order and on track; and with LGI Homes’ generous structural warranties, they rest soundly knowing that should any problems with their home arise, LGI Homes will be there to resolve the problem.

When it comes down to it, a home is simply a house, imbued with love and light, in which your days ought to be merry and your nights ought to offer a sleep that is sound, safe, and unfettered by worry. Why not come by this holiday season and discover what thousands of LGI Homes homeowners already know? That happiness in a house is only possible if it enables you to live the life you long to live, without fear, worry, stress or complaint. Merry days, and quiet restful nights, all in the secure warmth of your very own home—that’s what the dream of homeownership is really all about.

The proposed changes remove some of the government’s real estate market supports put in place during the recent economic upheaval, which were designed to keep the housing market afloat through crisis times. This withdrawal of government support, however, is facing opposition from real estate agents, new home builders, and mortgage bankers.

As the primary mortgage lender for first-time home buyers, the stake which the FHA takes in the mortgage market makes a huge difference. Currently, homeowners can take out FHA-backed loans with a minimum down payment of three and a half percent. The draft bill being circulated by Rep. Judy Biggert (R., Ill.), would raise that minimum to five percent. Dow Jones reported that Biggert said the proposal “would ensure accountability and financial stability within the FHA program.”

Representatives from the housing and banking industry did not agree. Ron Phipps, president of the National Association of Realtors said raising the minimum deposit “does little to reduce risk of default compared to strong underwriting requirements, and only puts home ownership out of reach for many families who have the income necessary to carry the cost of the home purchase,”

Mortgage lenders are opposed to the recent proposal as well. Michael Berman, chairman of the Mortgage Bankers Association, explains that cutting the limits “would drastically deny access to credit for many otherwise qualified lower and middle class borrowers. We need to be very cautious in enacting these proposals, given the continued weak state of the housing market.”

Biggert, however, argued for a reduced federal role, saying that “the private market can’t function when it is crowded out by the federal government.”

The FHA doesn’t make loans but insures them against default. According to trade publication Inside Mortgage Finance, loans backed by the FHA made up nearly 18 percent of new loans made in the first quarter of 2011.

A typical urban or suburban neighborhood can be comprised of an eclectic group of residents. New neighborhoods, such as those offered by LGI Homes, are often family-focused environments, filled with friendly neighbors—many of whom likely share common interests.

Brown says that today’s builders, particularly Texas home builders, “are responding to home buyer preferences for outdoor living and entertaining. Rooms are designed to flow into each other more easily and new versions of the great room concept lend generous space for parties and informal gatherings. If you enjoy patio dining and relaxing, you’ll find that new homes offer more common areas and transitional living spaces, as well as outdoor kitchens and fireplaces.”

When looking at resale homes, would-be buyers have to imagine what the space will look like when decorated to their liking. Buying a new home allows buyers to create the home decor from the very beginning, Brown says, “without the time and expense of removing wallpaper, popcorn ceilings or dated paint colors. Having a clean slate and a sparkling new kitchen can also make new construction very appealing. Additionally, you don’t have to worry about working with overgrown shrubbery or unimaginative landscaping.”

Brown also points out that new homes are designed to accommodate modern technology in a way homes built even just five years ago couldn’t imagine. “New homes are wired or pre-wired to accommodate the latest in high-definition televisions, home theatres, DVRs, computers and other technology-related devices and applications,” he explains. “Many older homes are simply not equipped to handle the different electrical requirements of today’s (and tomorrow’s) technology.”

For more information on the way today’s homes are built, visit an LGI Homes community in San Antonio, Houston, or Fort Worth.

The recent housing slump has prompted many lawmakers to call for a restructuring of the housing market, which could make it harder for Americans to qualify and pay for home mortgages. The latest suggestion that appears to be gaining bipartisan support in Congress would require a minimum 10-20 percent down payment for most home loans, with both critics and supporters of the measure saying that it would represent a major change to “business as usual” in the housing industry.

Edward Pinto, a fellow with the American Enterprise Institute who thinks a 10 percent down payment is fair, explained to National Public Radio, “We put too many people into houses they weren’t qualified to buy, they didn’t have income [and] they didn’t have skin in the game. And if people know they need the down payments, they’ll start saving for them. You can’t just buy lattes if you need to be saving for down payments.”

Other economists and housing advocates oppose down payment rules because they believe it unfairly and negatively affects minorities and others with economic disadvantages. Mike Calhoun, the president of the nonprofit Center for Responsible Lending, calculates it would take an average person seven years to save up for a 10 percent down payment. Plus, he says, the real issue is not the down payment.

Calhoun asserts the housing bubble and subsequent foreclosure mess happened primarily because lenders gave out no-document loans, in which they failed to verify if a homebuyer made enough money to pay back the loan. “The taxpayers got stuck with a big bailout, and so people sort of want to throw the baby out with the bath water and say, Let’s never do anything like that again,” he told NPR.

The other major change being discussed is the demise of the traditional 30 year loan. Instead, some interested parties are suggesting that banks and borrowers should opt for shorter-term loans, such as 15 or 20-year fixed-rate loans—a practice much more in keeping with the rest of the world.

While acknowledging such loans would require a higher monthly payment, Pinto suggests it could actually end up benefiting homeowners, because they amortize much faster than 30 year loans, meaning borrowers would gain equity much more quickly because they would begin reducing their principle balance much sooner into repayment.

So what does all this mean for those interested in purchasing a home right now? The bottom line: if you have been thinking of buying a home and don’t have the money for a large cash down payment, you may want to make your move before legislation changes the rules of the game. This may be the perfect time to check out properties offered in LGI Homes’ communities, where monthly payments start under $700, and no downpayment is required.

Eric Lipar has LGI Homes on a fast track for growth because the CEO wants to take the company public within the next five years.

LGI Homes recently acquired 313 home lots in the Houston area, has another 200 lots under contract and is opening an office in Phoenix — the first time it has expanded outside Texas. On top of that, the Conroe-based homebuilder broke a company record in October by closing on the sale of 57 new starter homes in one month. That breaks the previous LGI Homes record, set in February 2008, of 56 closings. The company ranked No. 12 on the Houston Business Journal list of Largest Houston-Area Homebuilders with 2009 local gross revenue of $28.5 million.

Lipar is lining up multiple capital sources and buying land and home lots to fuel strategic plans at the company, which he owns with his father, Tom Lipar. The CEO says a family-owned business only has two exit strategies — sell or go public. LGI Homes chose the stock option.

The homebuilder is opening a Phoenix office because the company needs to have operations in at least two markets besides Texas to go public, Lipar says. LGI Homes intends to expand into Atlanta or one of the Florida markets in 2012 to meet that requirement.

Tony Avila, with San Francisco-based Avila Advisors, is guiding LGI Homes on future growth plans. Avila also paired LGI Homes with New York-based GoldenTree InSite Partners earlier this year to create a $50 million joint venture to buy discounted home lots (see “LGI Homes, GoldenTree InSite targets dirt-cheap lots,” April 2, 2010, at bizjournals.com/houston). GoldenTree InSite, which goes by GTIS, was one impetus behind expanding in Phoenix. Lipar says both joint venture partners believe Phoenix is a great long-term market because it has a large inventory of finished home lots available at a discount.

Lipar expects land prices in Phoenix to hit bottom in 2011, making it a good place to sell homes in 2012.

MOVING FORWARD

Closer to home, LGI Homes recently completed its first local deal with GTIS since they formed their alliance. The partners acquired 202 home lots in rural Mallard Crossing, a community two miles from U.S. Highway 290 in Hockley, northwest of Houston. LGI Homes bought the lots from Joe Fogerty, manager of 195 Mallard Crossing Ltd., for an undisclosed sum. Lipar says the company normally spends $20,000 to $25,000 to get a lot ready for home construction, and the Mallard Crossing lots were purchased for approximately 70 percent of replacement cost. That would put the value of the deal between $2.8 million and $3.5 million.

LGI Homes started building its first six houses in Mallard Crossing on Dec. 1. The six different floor plans range in size from 1,200 square feet to 2,400 square feet and will be priced at $104,900 to $149,900. Sales will begin in January on the six homes, which will be ready for move-in in February. Another six homes will break ground in January.

The company’s strategy is to build starter homes on a speculative basis rather than construct model homes. It only takes LGI Homes 45 to 60 days to complete a house, because it does not give home buyers the option of customizing finishes. “It keeps our cost down,” Lipar says. “They’re very easy floor plans to build.” First-time home buyers also like the fast process, he says, because they usually need to move quickly because of expiring leases.

LGI Homes also broke ground last week on the first six houses in the Sterling Lakes master-planned community in Rosharon. LGI Homes recently bought 111 finished home lots in the community south of Houston with financing from Regions Bank. Lipar would not reveal the purchase price, but says LGI Homes got a 30 percent to 50 percent discount on the lots. “We’re paying less than replacement cost,” he says. The Sterling Lakes homes will range in size from 1,200 square feet to 2,500 square feet and cost between $120,000 and $170,000.

In the Baytown area, LGI Homes and GTIS also have 200 lots under contract in a deal scheduled to close within 60 days. LGI Homes intends to build homes on all of the lots it acquires. The company initially will construct 24 homes in each community, then add to the inventory as they sell.

The homebuilder, which ranked as Houston’s highest in the 2010 J.D. Power and Associates New-Home Quality Study, is in the process of hiring salespeople and other employees to handle the new work.

So we’ve seen which builders leave customers most satisfied, but what about quality rankings? This list looks at the number of construction problems in a new home, focusing on 41 categories like the bathroom, kitchen and home exterior.

Just so you know, JD Powers tells us the problems reported most often in Houston include electrical, heating and air conditioning issues.

The builder with the least number of reported issues is LGI Homes of Conroe.

“We are really proud of the JD Power New Home Quality ranking,” said Eric Lipar, CEO of LGI Homes. “We have always maintained that first-time homebuyers don’t have to sacrifice service and quality, for affordability. We have an onsite dedicated professional that insures every home meets our top quality standards and is ready for move in. I am really impressed with our team and thankful to our customers for this recognition.”

[Read the entire Article on 39Online.com]

Source: BuilderOnline.com

The downturn of the housing market—along with intensified competition for a very limited pool of home buyers—has reinforced the importance of customer focus for new-home builders,” said Dale Haines, senior director of the real estate and construction industries practice at J.D. Power and Associates. “In this buyers’ market, builders that are attentive to customer needs and focus on relationship building stand the best chance of enduring through the market recovery.”

2010 New-Home Quality Study

The J.D. Power and Associates New-Home Quality Study, now in its fourth year, measures the occurance and impact of construction problems experienced by new-home owners in 17 markets.  The study utilizes an index that measures problems in 41 categories for the following aspects: bathroom; drywall; electrical/appliances; flooring/stairs; home exterior; interior paint; kitchen; windows/doors; and other significant problems.

LGI Homes ranks highest in new-home quality in the Houston market. Home quality in the Houston market has improved from 2009, averaging 850 in 2010—up by 18 points from the previous year.

To be included in the studies, Houston-area builders must have closed 150 or more homes in the market in 2009. The new homes are located in the following counties: Brazoria, Ft. Bend, Galveston, Harris and Montgomery.

These studies are based on responses from more than 16,400 buyers of newly built single-family homes who provided feedback after living in their home from four to 18 months, on average. There were 2,273 respondents in the Houston market. For more comprehensive builder rankings for all 17 U.S. markets, visit www.jdpower.com/homes.

For more information, read an article, watch a video or view new-home builder customer satisfaction ratings on JDPower.com.

About J.D. Power and Associates

Headquartered in Westlake Village, Calif., J.D. Power and Associates is a global marketing information services company operating in key business sectors including market research, forecasting, performance improvement, Web intelligence and customer satisfaction. The company’s quality and satisfaction measurements are based on responses from millions of consumers annually. For more information on home building and home improvement; car reviews and ratings, car insurance, health insurance, cell phone ratings, and more, please visit JDPower.com. J.D. Power and Associates is a business unit of The McGraw-Hill Companies.

About The McGraw-Hill Companies

Founded in 1888, The McGraw-Hill Companies (NYSE: MHP) is a global information and education company providing knowledge, insights and analysis in the financial, education and business information sectors through leading brands including Standard & Poor’s, McGraw-Hill Education, Platts, and J.D. Power and Associates. The Corporation has more than 280 offices in 40 countries. Sales in 2009 were $5.95 billion. Additional information is available at http://www.mcgraw-hill.com/.

[View the entire Press Release]

For the past 5 years, LGI Homes has been recognized by Builder Magazine as one of the top home builders in the United States.  Moving up 11 places from 2008, LGI Homes was recently ranked No. 57 on Builder Magazine’s 2009 Builder 100 List.  This list determined based on closings and is made up of both private and public builders.  LGI Homes continues to stand out year after year by providing quality homes at affordable prices to new homebuyers. 

LGI Homes features three, four and five bedroom floor plans with two bathrooms on over-sized lots. Every home comes with quality appliances, custom cabinets, a fenced backyard, front yard landscaping and a homeowner warranty.

In addition, all LGI Homes are built with thousands of dollars worth of upgrades already included at no extra cost to you in desirable locations that are perfect to fit the needs and desired lifestyle you dream for your family. 

Call or visit one of our beautiful LGI Homes communities today and see how you can own a new home for as little as $629* a month with no down payment required.

Canyon Crossing – San Antonio, TX | Deer Creek – S Fort Worth, TX | Chisholm Springs – N Fort Worth, TX | Creekside Village – N Houston, TX | Sunrise Meadow – S Houston, TX

By:  John Caulfield, Builder Magazine

Recessions have a way of separating winners from losers. And as the housing market inches closer to recovery, indications about which companies are likely to survive or fail become clearer.

Some companies are exploiting the economic downturn to strengthen their competitive positions. Others have used the recession to reinvent themselves. And a handful of new builders and suppliers have entered the market either to create new demand or to fill voids vacated by companies that have tripped or fallen. The following list of companies to watch this year includes builders and suppliers that are poised to take advantage of an economic upswing or, at the very least, stay ahead of the pack if the recession lingers.

LGI Homes, Conroe, Texas

ON THE MOVE. LGI Homes’ business model is to convert renters to first-time buyers with aggressive marketing and affordable products. The builder expects to close 600 homes in Texas this year.

Something unexpected happened at LGI Homes in 2009: Its revenue and closings went down for the first time in four years.

The company—which in 2008 was the only builder among the top 200 that reported sales and closings gains—closed 425 homes last year, versus 476 the year before. The problem wasn’t demand, according to president Eric Lipar. “It was just harder to get buyers approved for loans,” he says.

While closings were off, LGI Homes ended 2009 with its sixteenth consecutive profitable quarter. “We made $5 million [in 2009], our gross margins were up, and our costs per sales were down,” says Lipar.

LGI’s business model is to convert Texas renters into first-time buyers. It methodically sends out flyers to apartment dwellers within 30 miles of its subdivisions and keeps its sales offices open for nearly 12 hours each day, seven days a week.

This formula is working again at the company’s newest subdivision, which is also its fourth and is located in South Fort Worth, where LGI Homes picked up 210 completed lots on which Sovereign Bank had foreclosed. The bank not only helped finance that acquisition, but provided $3.5 million in construction loans. LGI Homes also raised $2 million from private equity sources, which Lipar says made that deal possible.

In mid-December, Lipar said LGI Homes had sold 15 homes in South Fort Worth and had 15 others under contract. He’s now projecting 600 total closings for 2010, when his company will have a full year of selling under its belt in that subdivision, and expects to add new neighborhoods in Houston and the Dallas-Fort Worth markets.  [Read the entire article.]

Source: BuilderOnline.com