Anyone doubt the real estate crash after reading this article, we'll, I've got some land in Florida to sell you.
Oh, man, this got ugly really, really fast. Read the full article for some perspective on Japan and Florida in the late 1920s. We've seen it all before folks. Classic Ponzi Scheme.
Toll, Centex, Lennar Join `Moron' Speculators in Land Grab Bust
Feb. 7 (Bloomberg) -- Brian Tuttle owns so much land that he paid $3.6 million to get rid of 125 acres ready for development in the middle of Florida's Palm Beach County.
``In 2005, I was a brain surgeon, and in 2006, I was a moron,'' said Tuttle, who walked away from his deposit on the land rather than lose even more money buying it and building homes on it. ``The only good news is that I'm not alone.''
The worst housing slump in 16 years made a lot of smart money vanish. D.R. Horton Inc., Pulte Homes Inc., Lennar Corp., Centex Corp. and Toll Brothers Inc., the five biggest U.S. homebuilders, said plummeting land prices cost them a combined $1.47 billion in the fourth quarter.
Builders paid more for land during the boom because home prices were rising, too. They didn't realize speculators were pumping up demand by buying houses to sell quickly. When prices reached a point where speculators quit buying, homebuilders were forced to abandon so much property they helped create a glut that drove down land prices
These days, the speculators are looking foolish, too. In Florida, where they helped inflate land values as much as 10-fold from 2000 to 2005, prices have dropped by as much as 50 percent.
``The land market has dried up,'' said Alex Barron, an analyst at San Francisco-based JMP Securities LLC. ``Most builders are on the sidelines because they expect prices to go down another 30 percent.'
St. Joe Co., Florida's biggest private landowner, said yesterday the average price per acre of land it sold in the fourth quarter dropped to $1,900 from $4,100 in the third quarter.
``It's going to be pretty ugly,'' McCabe said. ``Lots of people will lose money and a lot of paper wealth will be going away.''
February 07, 2007
Florida real estate crash: Land prices down as much as 50%, expected to tumble another 30%, speculators getting slaughtered
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11 comments:
Folks,
very interesting article in
CNNMoney: What's your house really worth?
How Zillow is turning online voyeurism into a real estate revolution. Fortune's Jeffrey M. O'Brien reports.
goto
http://tinyurl.com/2zazpv
"Builders paid more for land during the boom because home prices were rising, too. They didn't realize speculators were pumping up demand by buying houses to sell quickly"
Oh those poor builders, to be so blind, innocent, and deceived!
Gimme a break! ROTFLMAO!
That widow holding onto the land to get $600,000 for something she paid $80,000 in 2004 is the classic example. Doesn't she realize that not only won't she get $600,000, she will be lucky to get someone to give her the $80,000 she paid. The next owner's carrying costs will be higher than hers.
If she is paying $4500/year to carry a 1/2 acre of vacant land that had a price of $80,000, what does she think the person who pays her $600,000 will be paying???
Yes, it is fun to get all up in every body else's real estate business via zillow.
"Margie Bushnell is one land speculator who said she's willing to wait to get the price she desires. The 77-year-old widow from Flagler County, Florida, owns a half-acre parcel on Highway A1A...
Bushnell is offering the land on Craigslist.com, a free on- line advertising site. A year ago, her price was $699,000. Now she's asking $650,000. She said in a half-whisper that the land, zoned mixed commercial and residential, could be had for $595,000. She's ready to wait another year for a buyer at that price.
How much did Bushnell pay for the half-acre in 2004?
$80,000."
Not to be too harsh but... she will be dead before she gets 595K.
"The worst housing slump in 16 years made a lot of smart money vanish."
LOL. "Smart" money my ass. The smart money is long gone, but will be back years from now to buy at rock-bottom prices. You won't hear about it from the MSM by then, of course.
Once a trend hits the mainstream media, it's over!
All is well. The proof is that Salt Lake City is still holding up well.
Unbelivable...she'll be pushing up daisies before she gets her asking price.
How much did Bushnell pay for the half-acre in 2004?
$80,000."
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Greedy bitch!
Somehow the fact that people in Florida are getting screwed is not a problem. Pretty much the place stuck us with the current moron in the white house. To add insult to injury they were supposedly getting rich. Well, its now payback time. Sure there are decent hard working people in Florida--they just happen to be a very small fraction. I south florida in particular it is so sleazy and corrup. Land of the scam, the easy money, status seaking (not achievement or contribution the whole place is based on appearances and scams)--they deserve it good and hard.
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