Scontrino says present economy makes for good time to buy home

Published 12:00 am Wednesday, November 12, 2008


Editor and Publisher

LAPLACE — With the recent election of a new president for the United States, most Americans are looking to Washington with one main thought in mind: the economy.

While there are always social issues to be debated between both parties, many a politician has reverted to an old comment by one presidential candidate that sums up what most Americans really are most concerned about: “It’s the economy, stupid!”

That remark was made years ago by one presidential candidate, who was making it clear that out of the multitude of issues to argue over, the vast majority of Americans are still most concerned with how much money is in their own bank account.

The economy has hit the skids in the past 12 to 24 months, and regardless what happens in Washington D.C. now that there is a new president preparing to take office, folks in the River Region are still more concerned about the state of the economy in St. John, St. Charles and St. James parishes.

One local businessman, who has made it a priority to watch the economy locally, and analyze statistics here, said that there is good news and bad news for the River Parishes.

Joey Scontrino, owner of Landcraft Homes, has made it through a difficult time for real estate in the last two years. While other top builders have fallen by the wayside, shutting down and going bankrupt, Scontrino has downsized and stayed afloat even as the market has slowed considerably.

“In terms of the home market, it is still in a general decline, especially for St. John,” he said. “The traffic is not improving, and quite honestly, I don’t see it getting better in 2009.”

Scontrino said that the problem in St. John, as well as the entire Southeast Louisiana region, is a matter of job creation.

“You have to have jobs to see population growth, and other than the industry with some expansion, we do not have big retail stores coming in here, or much of any other big job expansion here. That is the problem,” he said.

But even as the very lack of a big population growth is keeping the St. John real estate market at a very sluggish state, he said there is very good news in the midst of that for the potential home buyer.

“There is no doubt that right now is perhaps the best time to buy a home than there has been in years,” he said. “The problem, however, is that a lot of people are being very cautious right now about making that kind of big commitment financially.”

Scontrino pointed to extremely low interest rates as a good reason to buy a home right now, and also noted that the competition among real estate companies has made prices extremely good.

“Truthfully? People who are buying right now are smart,” he said. “There never was a better time to buy a home, and I’m not saying that just because I sell homes. Prices are great right now, and rates are as low as ever.”

However, Scontrino said his company is seeing great caution from potential buyers, evidenced recently from some open houses at various of his subdivision open houses.

“We have noticed that people showing up take a long time to decide,” he said. “We are looked to as a bedroom community to Kenner, but we see a lot of people scared to make the move right now since the job situation concerns them when considering a big purchase.”

While other top builders in St. John Parish have gone under in the past year, Landcraft has survived the slowdown by watching the market carefully enough to avoid overbuilding. But the drop in real estate action is clear when Scontrino said his company will probably do a total of 100 units for 2008, compared to over 200 units they produced in 2007.

The change locally will come, he said, when the job situation improves.

Scontrino said that even though there was a big job hike in St. John from Marathon’s $3.2 billion expansion, many of those people are not moving here.

“That’s what we have seen,” he remarked. “Even though we are getting 500 permanent jobs from Marathon, we have checked and found that many of those people are not living here. They are still living in places like Gonzales and driving in.”

He does see hope in the fact that new Parish President Bill Hubbard has a business background, and is out recruiting companies to relocate here. Scontrino said that he and Hubbard recently began working on one company which could offer over 300 jobs, and is considering St. John as their new location.

“Bill Hubbard is going to help the situation since he speaks the business lingo,” he said. “No knock against Nickie (Monica, former parish president), but Bill has a business background, and that is going to help us recruit businesses here.”

Scontrino also complimented the Port of South Louisiana for the work they continue to do, bringing new businesses to the region.

“That is the kind of thing that will help us out,” he added. “We just have to see more job growth to see the economy get moving here. But personally I don’t see anything getting much better until after 2009.”

Scontrino added that one only needs to look at the New Orleans tourism industry to see how sluggish the entire region is.

“The occupancy rate for hotels in New Orleans continues to run around 47 to 52 percent,” he said. “You never used to be able to call New Orleans in October and find a hotel room very easily, but now you can. Their rate used to be at 94 percent occupied at this time of year, but you can see how far off it is now. That tells the whole story of how far the New Orleans area still has to come back.”