MSM is now covering the builder price slashing going on in the bubble markets. Remember, these builders can go much lower than Joe Homeowner, and they'll crush him on the panic to the exits. $100,000 off? No sweat. No down? No sweat.
Blood is in the streets, and it's getting worse. It'll be a race to the bottom from here on out.
As the nation's home builders struggle with big inventories, a surge in cancellations and a pullback in demand, many are aggressively offering discounts in high-profile promotion campaigns aimed at getting a dwindling number of home buyers into their sales centers.
Mr. Barron, who recently returned from a tour of the Florida housing market, says certain builders are slashing prices so much that it is making it difficult for rival builders to compete. He cites the South Fork community near Tampa, where Hovnanian Enterprises Inc. was selling homes in the low-$300,000 range while Lennar, 500 feet away, had slashed its prices for homes of a similar size to about $230,000.
The price cuts and incentives aren't unique to Florida. There are signs and ads for significant discounts in other previously hot markets such as Phoenix; Washington, D.C., and California.
Some builders, such as Centex Corp., had been offering 12-hour sales at some of its sales centers in California, where buyers would be offered as much as $100,000 off the price of a multimillion-dollar home if they purchase a home during the sale hours.
July 21, 2006
WSJ: "Certain builders are slashing prices so much that it is making it difficult for rival builders to compete"
Posted by blogger at 7/21/2006