Huntsville MLS

While investors shouldn't ignore other areas, Madison continues to be the first choice; Huntsville MLS
March 13th, 2012 11:02 AM
While investors shouldn't ignore other areas, Madison continues to be the first choice for most newcomers (tenants) to the area. Parts of Madison have developed a bit of a traffic problem relative to what Huntsville is accustomed to. We just have to be selective on the locations we consider.

Medicine Bend has alternate routes to Redstone Arsenal and Research Park that avoid congested areas. The proposed Madison Hospital just behind Medicine Bend has recently opened and there is related growth in the area.

There is talk of another base realignment and closure BRAC in 2013. If this does come to pass Huntsville is expected to have a substantial number of defense and support positions move into the area.

There is continued demand for rentals in all price ranges but lower priced homes have much higher turnover and maintenance expenses. There is a smaller tenant pool above $1,400. Investors should focus on properties that rent in the $1,000 to $1,400 range. To hit this target we can focus on homes with market values in the $140,000 to $200,000 range. For lower maintenance costs we need to filter for newer homes and should include pre-construction in our search. We also need to filter for full brick construction, again for lower maintenance costs.

The link below is to a handful of properties I found that might be candidates.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490106

102 BROCKTON DRIVE is in the Oxford subdivision. It is located near the south end of County Line Road. It gives easy acess to Research Park and Redstone Arsenal via Highway 20 / Madison Boulevard. There are long term plans to add an eastbound ramp onto I 565 at County Line Road making acess easer. The neighborhood is located within about 3 miles of shopping.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490107

Link to map of shopping.

http://maps.google.com/maps?q=publix,county+line+%40+browns+ferry,+madison+,+AL++&hl=en&ll=34.721297,-86.782036&spn=0.031676,0.084372&sll=34.714968,-86.768087&sspn=0.063356,0.168743&hq=publix,county+line+%40+browns+ferry,&hnear=Madison,+Alabama&t=h&z=14

The negatives on this property are that the homes were fairly cheaply built and marketed towards entry level buyers based on the" Big house, Little price." tag line. While the homes meet code they are plain as plain can be. There have been a number of foreclosures in the neighborhood in the past several years. The other negative is that he house is about 1,200' - 1,500' from a railroad track. While there isn't a grade crossing where trains will be sounding their horns, one can still hear the trains.


176 JARRETT LANE is in one of my favorite neighborhoods. We have a number of rentals in the neighborhood that have preformed well.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490243

The link below is to the Google satellite image and street view of the property.

http://maps.google.com/maps?q=176+JARRETT+LANE,+MADISON,+AL+35758&hl=en&ll=34.72378,-86.759366&spn=0.0028,0.005273&sll=37.0625,-95.677068&sspn=31.28862,86.396484&hnear=176+Jarrett+Ln,+Madison,+Alabama+35758&t=h&z=18

The house backs up to a common area that is the beginning of a drainage creek, While the lot provides privacy, it does slope from the street down to the house. The times I have shown the house the buyers were concerned with storm runoff from the street. The property is not in a flood zone.



The house has been on the market since 09/29/10 with no price reductions. It is listed at $88 per square foot. The average sold price in the neighborhood since 03/01/11 was $91 per square foot.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490254

While this house might be a candidate, the concerns over storm runoff are a consideration. I think we can do better.

We do have two rentals in the neighborhood where the owner would consider selling. The best of the two is http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit. He would need to sell at around $168,000 / $98 per square foot. This is well above the average sold price.


119 GRANTHAM CIRCLE in the Asbury subdivision is just north of the 102 Brockton property above.

http://maps.google.com/maps?q=119+GRANTHAM+CIRCLE,+MADISON,+AL+35756&hl=en&ll=34.689704,-86.788044&spn=0.007922,0.021093&hnear=Grantham+Cir,+Madison,+Limestone,+Alabama+35756&t=h&z=16

The neighborhood is similar to the Brockton house. The original builder was a high volume production builder focused on entry level homes. The quality of the homes is a couple of levels above the Brockton house.

There are a number of new construction, proposed construction homes in the ASHBURY neighborhood. Breland Homes a local high quality production builder bought out the project three years ago from the developer. These homes at 1655 HEALEY DRIVE, 202 HEALEY DRIVE, 200 HEALEY DRIVE and 2253 MIDDLEWICH DRIVE might be candidates for us. We need to be careful on lot selection and make sure that the bulk of homes in this part of the development will be the newer more marketable homes.

I have sold a number of Breland Homes and am impressed with the quality of the work and in their realtor / buyer friendly corporate mind set. They build an attractive home at a remarkably low price. The link below is to the builders webpage for the neighborhood.

http://www.brelandhomes.com/ashbury.htm

105 MIDDLEWICH DRIVE is competing with the new construction in ASHBURY and at $105 per square foot is priced above the better quality new homes.

We have several rentals in the neighborhood of 205 DE JAN ROAD but the location of the lot for the proposed construction concerns me. It backs up to a major traffic artery, County Line Road. We should pass on this property.

http://maps.google.com/maps?q=205+DE+JAN+ROAD,+MADISON,+AL+35758&hl=en&ll=34.739849,-86.78607&spn=0.003959,0.010546&sll=37.0625,-95.677068&sspn=31.28862,86.396484&hnear=205+De+Jan+Rd,+Madison,+Alabama+35758&t=h&z=17

The link below is to a withdrawn listing in the same neighborhood where the house rented for internet edit before selling.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit

The link below is to the public record in the Huntsville MLS of where the current owner purchased the house at $139,000. Even if the seller had given me the lowest sales price they would accept, t I couldn't reveal it. I can however determine what their break even point on a sale would be. Assuming standard fees, costs and a $3,000 seller contribution to purchaser closing costs, they would have to sell at around $151,000 / If we dropped the total realtor fee to 4.5% their breakeven would be around $149,000 / $93 per square foot.

The average sold price for the past year was $89 per square foot with a range of $74 to $98 per square foot.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490726

When I drop out the $74 per square foot bank owned sale at 258 DE JAN ROAD the average sold price jumps to $92 per square foot. This house would be a fair but not a great purchase. If you have an interest I can approach the owner. He might be willing to take a loss.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490732

113 BLANCHARD PLACE on Balch Road is abound 2 miles south of medicine bend just south of Columbia Elementary School. This is a good location, close to shopping and an easy commute to Redstone Arsenal and research Park. There are plans to connect Balch to I 565 eventually. This will make the neighborhood more accessible. As long as we pick a house away from the front of the neighborhood, traffic noise won't be a problem

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115490746

175 AMSTERDAM PLACE is in the same neighborhood. if the MLS mapping is correct the house backs up to open space.

113 BLANCHARD PLACE is in the same neighborhood and price range but doesn't have the open space.

We have a rental in the neighborhood that is rented for $1,225.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit
The link below is to an old withdrawn listing of the house.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit

The owners purchase was not recorded in the Huntsville MLS. The amount of down payment is not public record but the mortgage is. Unless I am missing something the purchase mortgage was internet edit. To clear that amount they would need to sell at around $ internet edit / $ internet edit per square foot. While thy may not accept that amount, the public records give us an idea of what they are into the house for.

http://probate.co.madison.al.us/LoadImage.aspx?sk=2 internet edit &format=PDF&ref=24c2729d- internet edit

The link below is to a summary of MLS activity in the neighborhood in the past year. The average sold price was $82 per square foot with a range of $79 to $85 per square foot. Again I don't know what seller is thinking on a net proceeds but this one might be worth a closer look.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit

internet edit and internet edit are located in the same neighborhood and are listed at $89 and $91 per square foot.

internet edit in the same neighborhood is listed at $ internet edit per square foot it a four bedroom home and seems to be very well priced. This one deserves a closer look.

The house has been on and off the market since internet edit and was originally listed at $ internet edit. The Huntsville MLS doesn't have the currents owners purchase of the house recorded but probate records sow a 2003 purchase mortgage. The mortgage amount is not included in the recorded document.

http://probate.co.madison.al.us/LoadImage.aspx?sk=20030926000785350&format=PDF&ref= internet edit

A mortgage release and then a new mortgage is recorded.

http://probate.co.madison.al.us/LoadImage.aspx?sk=20100105000007920&format=PDF&ref= internet edit

The new internet edit mortgage was for $ internet edit
http://probate.co.madison.al.us/LoadImage.aspx?sk=20091223000792430&format=PDF&ref= internet edit

Unless I am missing something in probate records, they owe something less than $internet edit . Seller has room to negotiate if they have the motivation.

At the $ internet edit list price and a 20% down payment ($ internet edit) and a internet edit% mortgage rate the principle and interest payment will be $855.

The current annual taxes are $internet edit and are at the homestead rate. The investor taxes would be $internet edit or $internet edit per month.

If we estimate the annual insurance cost at $700 the monthly amount would be $58 for a total payment of $1,101. At a rental amount of $1,200 and 10% management fee your monthly proceeds would be $120 per month. for a net month proceeds of -$21.

The two variables we have some control over are the down payment and rental amounts. If we increased the down payment the principle and interest payment will drop $27 per $5,000 additional down payment.

The link below is to a summary of recent rented listings in the neighborhood. Based on the data we could push the rental amount to at least $1,250. In the peak summer season we might push to $1,300 or better.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID= internet edit

I did use an interest rate a little higher than your recent loan and did use the list price. I expect that the house could be purchased for fomenting less than list price.

102 OAK SHADE DRIVE, 122 FOREST GLADE DRIVE, 105 ALDERWOOD DRIVE and 106 ACACIA TRAIL DRIVE are all in the Old Ivey subdivision. While I like the general location as being close to Redstone Arsenal and Research Park I do have concerns. The lots are VERY small and some are sloping. I am always concerned about future foundation problems on lots where there has been fill added. The neighborhood is on a hill about .8 miles from a grade railroad crossing. There is no doubt about hearing the train. Of greater concern is the low income multi-family property just over the tracks. Two years ago there was a drug bust in what I thought was a great neighborhood. The bust was substantial enough to have made the news.

At first look 125 CHELSEA PARK ROW seems to be priced well above what the market will bear at $127 per square foot and the stained concrete floors won't appeal to everyone. The location off of Balch Road is good but the house is very close to a flood zone.



In the past year there have been no resales in the neighborhood. All of the sales at the following link were new construction. The average sold price was $106 per square foot.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115496445


I did want to include a few properties in (close in) northeast Madison County. We moved to the area four years ago and regret having not moved sooner. Except when there is a wreck we can be at our downtown office in 15 - 20 min. Redstone Arsenal and Research Park are 5 - 10 min. further west. The schools here are good and there is basic shopping and a few restaurants in place. Before the economy crashed there were plans for a Target shopping center with about 50 stores. Ground preparation had already been done. There are long term plans to extend I 565 about 3 miles further east. The schools are good and there is still open space, mountains lakes and a river.

Be sure to consider the homes in Brooks Landing. I am partial to the location for easy acess and many of the lots have mountain views. The second link is to the builder's web page for the neighborhood.

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115496504

http://www.brelandhomes.com/brooks-landing.htm

Brooks Landing Map.

http://maps.google.com/maps?q=1933+BROOKSLANDING+DRIVE,+HUNTSVILLE,+AL+35811&hl=en&ll=34.783074,-86.500769&spn=0.031652,0.084372&hnear=Brookslanding+Dr,+Huntsville,+Madison,+Alabama+35811&t=m&z=14


Brooks Landing Satellite;

http://maps.google.com/maps?q=1933+BROOKSLANDING+DRIVE,+HUNTSVILLE,+AL+35811&hl=en&ll=34.779267,-86.503944&spn=0.031653,0.084372&hnear=Brookslanding+Dr,+Huntsville,+Madison,+Alabama+35811&t=h&z=14




There is one listing on the street where I live,

http://nalmls.com/NALMLSReports/ListitLib/show_report.aspx?ID=7115496519

The house backs up to open space and has acess to the Flint River. The commercial operation to the northeast is a potable water plant. At the subject house there is no impact. At night there are pumps that run in the two buildings north of the house with the pool. You can hear the pumps from the houses in the curve to about 5 houses to the west.

http://maps.google.com/maps?q=209+RALEIGH+WAY,35811&hl=en&ll=34.785127,-86.48813&spn=0.003956,0.010546&sll=37.0625,-95.677068&sspn=31.28862,86.396484&hnear=209+Raleigh+Way,+Huntsville,+Alabama+35811&t=h&z=17

Comparables will be tough here. There haven't been any recent sales in this new addition