Fun From FHA

A 2,000-house project that will pioneer a major new trend in U.S. home building was started last week in Florida's Dade County, ten miles south of Miami. The Sunset Park project will be the first in the nation to take advantage of the Federal Housing Authority's new program for cooperative housing. Under the plan, recreational areas must be built along with the houses. At Sunset Park, buyers of $13,500-$16,000 homes will also own part of a community building and a recreation area with an Olympic-sized swimming pool, tennis, handball, basketball and badminton courts, a Little League diamond, shuffleboard and a barbecue area. The builders, Herbert Heftler, 46, and Dallas' Centex Construction Co., estimate that the cost will be $15 more per year on each mortgage in the project. Says Builder Heftler: "This is the solution to people's battles with local government over the establishment of a recreation area."

Gone are the bad old postwar days when the demand for houses was so great that builders could quickly put up almost any kind of house and sell out. Today's projects require much better planning, and the trend is toward a self-contained community. The new FHA program not only gives the home owner a more desirable community, but makes it easier for the builder to sell his houses.

The Benefits of Bigness. While many builders have steered away from the FHA cooperative program because they are too small to cope with the red tape and financing complications, Heftler is a big enough builder to thrive on it. In 1959 he built 50% of his homes under the program that requires buyers to sign up before their homes are constructed, lay out 5% of the purchase price in cash.

Heftler has succeeded because his large volume allows him to arrange favorable financing, absorb costs that smaller builders cannot afford. He gets a 6% to 7% discount on building materials and can afford to take a 5% profit on a $12,500-$16,000 house v. 10% for a small builder. Heftler, along with Centex Construction Co. and Arizona's John Long (TIME, May 18), is among the top three builders in the U.S.

New York City-born, Heftler left school to serve in the infantry during World War II, started his building career in 1945 with $100,000. (Today he is worth $10 million.) After building Government housing projects in Detroit, Indianapolis, and Fort Sheridan, Ill., he bought large tracts of land in California, built 3,000 houses in six projects there. Heftler claims he has never lost money on a deal. Says he: "The guys who have lost money are the ones who thought they could pioneer in a wilderness. We always stay in areas where housing is in strong demand." After the Florida boom began, he started building there, decided that his market was for the young home owner, not the retirement market that has attracted other Florida builders (TIME, May 19, 1958). Last year he built 2,389 homes in the $12,000-$16,000 price range in Florida.

A $230,000 Mansion. Heftler himself lives in California in a $230,000 whitewashed hillside mansion in Beverly Hills. But he did not construct the pleasure dome himself. Says he: "A contractor should never build his own home. He makes too many changes, and it ends up costing him four times as much as it should."

Since 1957 Heftler has sold 3,976 homes in Florida, plans to sell twice as many in the early 1960s. Along with the Sunset Park project with Centex, Heftler plans to build junior executive-type houses in Carol City, will start a 5,000-home development in Orlando that will have community recreation facilities.

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