This demonstration home by Whitman Homes is located in the Chipping Hill neighborhood of The Pinehills in Plymouth. Prices for homes in Chipping Hill range from nearly $600,000 to $1 million.

Some Massachusetts Realtors may be whispering about how sales of high-end homes are suffering because of the economic downturn, but agents and homebuilders on the South Shore tell a different story. Pent-up demand and low interest rates, they say, have kept sales of all types of newly constructed homes in that part of the Bay State humming along.

In fact, builders of some of the larger developments under construction in Southeastern Massachusetts maintain that they have not had to alter strategies or marketing because of the economic downturn. Prior to the turn in the economy, the region had been one of the most active in the state in terms of new housing subdivisions, in part because land there remains more available than in many communities north and west of Boston. Despite the many new homes being introduced into a sales market that seems to be slowing statewide, developers in areas such as Plymouth County say sales remain strong.

We’re selling more [homes] than we can deliver right now, said Eileen J. Richardson, partner and director of sales and marketing for Oak Point.

Oak Point is an active adult community of 700 single-family homes under construction in Middleborough. Sales are so good, according to Richardson, the developers are even eyeing hundreds of acres nearby to build another 450 homes.

According to Richardson, a comparison of sales figures shows that Oak Point is maintaining and even surpassing last year’s numbers. So far, about 300 homes have been built and more than 300 sold.

Sales are brisk enough that Oak Point officials have decided to reduce advertising.

Over 50 percent of our sales has come from referrals, Richardson said.

Part of the reason Oak Point is doing well is that there is a strong demand for active adult or empty-nester communities that cater to people 55 and older, she said, and those buyers tend to be cash buyers. That means that even if the buyers trying to move into those types of communities have trouble selling their homes, they can afford to reduce their asking prices so they can buy a new home.

The same could be said for The Pinehills, a Plymouth community that is planned to encompass more than 2,800 houses to go along with golf courses and commercial and retail space. The Pinehills, which features everything from elegant townhouses to luxury, custom-built mansions, is being heavily marketed to empty nesters.

The Pinehills’ projected build-out schedule is about 12 years and, according to Managing Partner Tony Green, the development company has made allowances for two recessions within that time period.

Seventeen homes have been sold at The Pinehills since the beginning of October – a pace that is way ahead of projections, according to Green. Seven of the homes sold were located in The Pinehills’ newest community, Winslowe’s View, which features townhouses and single-family homes. Altogether, 50 homes have been sold and 17 families have moved into The Pinehills.

In addition to Winslowe’s View, the community recently announced the opening of a demonstration home in its new luxury community, Chipping Hill, and the completion of its second golf course.

Even builders of smaller housing developments insist that business has been steady, despite the traditional slowdown during the holidays. Most builders said that during the month of September business came to a near standstill, an occurrence experienced by many industries in the wake of terrorist attacks in New York and Washington, D.C.

Joe Malloch, business manager for Malloch Construction Co. in Lakeville, said phone calls and inquiries stopped during September, and buyers did not show up to open houses. That started to change as more people got over the initial shock of the terrorist attacks, he said.

Malloch is currently working on a 49-lot subdivision of single-family homes in Lakeville called The Settlement. The well-known developer behind The Settlement sold all the lots to Malloch Construction in the summer. Malloch then sold off about a dozen lots to other builders.

According to a representative of Malloch and the broker marketing the homes, there was nothing unusual about the arrangement. Bob Vazza, a broker for Jack Conway & Co., said the Lakeville-based developer has worked on several projects with Malloch Construction, in which Malloch did all the building. The fact that Malloch Construction sold lots within The Settlement to other builders does not reflect panic from the economic downturn, according to Joe Malloch.

Malloch said that generally with any subdivision, the company sells off lots to other builders to recoup cash quickly.

Vazza said he has not had trouble marketing The Settlement because it is in a desirable location – a little more than a mile from Interstate 495 and the commuter rail station. The homes start at $450,000 with undeveloped lots selling for up to $160,000.

[This project] got off to a fast start and continues to be moving, he said.

So far, there are 13 unsold lots at The Settlement, where selling started in the spring, said Vazza.

‘Holding Together’
Jay and Paul Gallagher, brothers who own J.P. Gallagher Construction & Development Co. in Hanover, echo those remarks.

According to Jay Gallagher, there is pent-up demand for homes on the South Shore, where it can take as long as two years to get approval to start construction.

The Gallaghers are currently working with Boston-based A.W. Perry to build Stone Meadow Farm, 38 custom homes built on one-acre lots in Hanover. The homes are selling for between $775,000 to more than $1 million.

Four families have already moved into Stone Meadow Farms, and two new buyers have expressed serious interest, according to Paul Gallagher, who said buyers are willing to pay for well-constructed, quality homes but may be resisting the overpricing of some homes that occurred when the market was stronger.

His brother, Jay Gallagher, said that buyers may be drawn to the South Shore because they can get more for their dollar than they can elsewhere – like in MetroWest communities.

Although brokers and developers do admit the market is softer now than it was a year ago and high-end homes are moving more slowly, most say that starting prices in new subdivisions are unlikely to decrease dramatically. Jack Conway’s Vazza said price reductions and changes in the overall look and make-up of homes within developments is difficult because most builders have restrictive convenance agreements and are bound to certain design plans.

What’s more, the majority of homebuilders have six months of work ahead of them, meaning they have pre-sold homes that they are working to complete, said Len Gengel, president of the Home Builders Association of Massachusetts.

Gengel, who owns C&S Builders in Rutland, said he has 12 homes he currently needs to build.

The housing industry as a whole in the state of Massachusetts is still strong, he said.

Kevin Sweeney, who takes over as president of HBAMA in June, said there is a bigger housing supply now and homes are staying on the market long. But builders do not have an excess of houses like they did in the early 1990s when there was more homebuilding and not enough demand to keep up, he said.

Generally, I think builders by and large were not overly inventoried to begin with. They didn’t have a lot properties sitting [vacant in preparation for development], he said.

Sweeney, whose company Sweeney & Sons in Maynard builds homes priced between $800,000 to $950,000, said higher-end homes are probably suffering a bit more than less expensive homes because a big market for those homes – executives who have been relocated – has been diminished. However, Sweeney has not heard of any horror stories from homebuilders who have had to file bankruptcy or take other drastic measures.

I think homebuilders are holding together the economy despite … the no-growthers’ attitude, he said.