Tuesday, August 12, 2008

We're All Not Golfers Now

by Tanta on 8/12/2008 12:55:00 PM

While we're on the subject of trouble at the housing high end . . . here's a report on golf club developments in the DC area from the Washington Post:

It wasn't long ago that real estate developers could build a golf course community and collect a $30,000 premium from customers who might not have even played golf, but aspired to the country club lifestyle.

Not anymore. Projects have been put on hold or canceled because potential buyers are no longer willing to pay extra, can't qualify for a mortgage or can't sell their homes to trade up. Courses that were too far along to stop are struggling to find customers.

"People just can't afford the luxury of a country club. It's become much more aspirational," said Marc Montgomery, a developer who opened his third Washington area golf course community this summer. Like the other two, River Creek in Virginia and Cross Creek in suburban Maryland, his latest, Oak Creek, is the centerpiece of an exclusive luxury community. He has brought in a company from Pennsylvania to manage the golf operations but, he said, "it's hard to spend $12 million [on a course] and make it back at $50 to $100 a round."

"If you don't have enough people buying houses fast enough, it's never going to work," Montgomery said.
I suspect that means it's never going to work.