February 16, 2008

HOLY HOUSING CRASH BATMAN!!! D.R. Horton conducting 50%-off going out of business firesale in California



Nah, there was no housing bubble. Real estate prices always go up you know. Housing is the best investment you can ever make. It's always a great time to buy.

Guess not.

Want to see housing anarchy? Head to the D.R. Horton 50% off sale this weekend and talk to the homedebtors in the neighborhood who DIDN'T get the 50% off price. Oh, man, are they gonna be pissed (and bankrupt). There goes the comps for a generation. Watch for the lawyers to come out too.

Thanks to letitsink for the link

Prices Offered Up to 50% Off During D.R. Horton's 'UnAuction' Sale - February 16 and 23 Only!

SIMI VALLEY, Calif., Feb. 8 /PRNewswire/ -- D.R. Horton has announced unheard of savings up to 50% off on a variety of homes at 23 participating neighborhoods throughout Southern California.

Unlike any Sale homebuyers have ever seen, D.R. Horton's UnAuction presents dramatic sale prices and unbeatable new home value without the auction hassle. The UnAuction's homes will go on sale promptly at 10 a.m. on Saturday, February 16 and again on Saturday, February 23 only.

39 comments:

Anonymous said...

Prices Up to 50% Off - February 16 and 23 Only!

Of course they neglect to mention that it's going to be 55% off next month and 60% off the following month.

Anonymous said...

What makes them think they can raise the prices back up after the sale?

The new comps won't let them!

Princess Mononoke said...

It's such a horrible truth!

Watch Bush and his cronies try to pass an IMMUNITY bill for the 'Homebuilders' protecting them from these lawsuits.

Frank@Scottsdale-Sucks.com said...

There's one of those infamous "luxury condo" projects under construction on the Santa Ana/Costa Mesa border near John Wayne Airport that has barely pre-sold anything and they just cut prices 50%.

HOUSE2008 said...

In a related note I was going to "buy" (make a deposit ect)one
of their homes last month. Called the sales guy up & found out the lot I was going to build on a 2500sf 5/3 deal sold for 10k less than my contract. I have the paperwork in front of me showing 335K. Wow. I can't imagine "losing" 10k in a month. Glad I backed out of that one.

eric in vegas said...

Get ready for tons of videos like this one from Florida auctions:

http://tinyurl.com/359ab8

The people that already bought there should just walk away because they are finished.

Anonymous said...

If you wait it will be 75% off in a couple months.

Ed said...

OH SNAP!!

tater said...

Talk about some pissed off people! Those current homeowners (aka, sheeple) are HOT!! This goes to show what these mega-corp builders do. They could give a shit less about the people that they sell to. This should be a shot across the bow to any sheeple that are thinking about buying from these type of builders (mega-corp), such as Pulte, etc.

Of course, the sheeple shouldn't be buying at all right now. But, they're sheeple. They're always looking to follow the realtor with the slickest vanity photo on his/her business card. Stupid sheeple

Anonymous said...

These crap homes need another 50% off before they are a value - seriously. Go visit one of these phony chicken coups and jump up and down on the 2nd story floor, the whole house wobbles. I've seen farm structures for live stock build much better.

keith said...

This should serve as a warning to any potential D.R. Horton customer in the future: They will screw you and destroy you without a care in the world

D.R. Horton - America's Family Destroyer

Anonymous said...

I'm from the east coast and I've NEVER even heard of any of the towns listed. When does this housing blow up start to trickle into the big cities. I still see SanFran condos for $2mil, and Manhattan keeps going up. Greenwich CT where all the Hedge fund folk live, a small house $1mil.

Anonymous said...

Not too sounds too NAR like, but some of those prices look pretty good. I'm not that familiar with the area but mid $200s for a brand new 2200 sq ft new home seems reasonable.

That has to to work out to less than renting one.

Buzz Saw said...

OMG, That link from eric in vegas is hilarious!

Did you hear the dude from Bahston who paid $300k for a house that sold last year for $145k? He was smokin" Bwahaha!! Sucker!

Buzz Saw said...

Waa!! I wanna do-over!

Anonymous said...

You got to wonder if they'll find buyers at half off

How can we find out?

happy homeowner in the stix said...

I bet they are still making money even at 50% off.

I want to find out how much they paid to build those nasty things out of chicken wire and styrofoam (no, not kidding about the construction methods there). Offer them 20% less than that price.....then it would be a real sale!

Ben Franklin said...

"Going out of business sale"? Huh? AFAIK, D.R. Horton has NEVER said this is a going out of business sale, so I'd be VERY careful claiming it for fear of legal recriminations (or if, God forbid, you were short Horton and failed to disclose that fact, the SEC might be investigating)!

Anyway, I saw the Horton website last week with this sales pitch after another housing bubble site posted a link. As usual, it BS marketing: they want you to at least go in to the tract to discuss with their sales reps.

Notice how the ad claims "up to 50% off" WITHOUT posting any details of where that discount applies, etc.

The "UP TO" bit is a classic lawyeristic "weasel words" designed to pull the sheeple in, thinking they're getting the "deal of the century: oh wait, I think another builder (Hovnanian) has used THAT SLOGAN last year, where it was meaningless babble then, as now.

Yes, it's a good sign of the times that things are progressing, but I think we're just getting started on real price corrections: let's talk in a few years, and you'll look back to Feb 2008 and thank yourself for not attempting to catch the "falling knife".

Anonymous said...

The unauction is taking place at 23 different sites. I checked Oxnard, CA and they claim about $500,000 for "water front" condos that were prviously $650,000 (if I remember accurately). Or it was $600,000. I think you'd have to check all 23 neighborhoods to find a property somewhere at 50% off some claimed previous price.

Anonymous said...

"These crap homes need another 50% off before they are a value - seriously. Go visit one of these phony chicken coups and jump up and down on the 2nd story floor, the whole house wobbles. I've seen farm structures for live stock build much better."

You are SO RIGHT about that!!!!!
The sheep who does purches these crapy built homes will be rebuilding the whole thing in 10 years.

Chuck said...

Notice that it says "Up to 50% off". This is fine old 'not quite bait-and-switch' terminology. I'm sure there will be some grand price reductions, but anybody going there hoping for a half-price deal on the home of his choice will probably be disappointed. You can bet there WILL be plenty of prices good enough to piss off those who bought recently at "don't tell anybody what we sold this to you for because we're not going to give anybody else this good of a deal" prices. I really can't imagine how you deal with having your home suddenly worth much less than you owe on it. From happy-go-lucky new home buyer to sucker in one fell swoop. Thoughts of lawsuits if not murder must lurk in the dark recesses of some troubled minds as they lie awake at night mulling over their financial futures.

Anonymous said...

They F!ck You in the drive thru!

dr of hamsters said...

Guess fire sale prices are the new black....hahahaha

TVFREEANDCLEAR said...

This is off-topic but I think it needs to be said. I have noticed a recurring use of the term "sheeple" and a common opinion that the general public in the U.S. lacks perception and judgement. While I am certainly not going to defend them, everyone should remember that for the last 50-60 years the people of the U.S. have been sublects of the largest mind control effort in the history of the world. Daily exposure to televison, whether one admits it or not, has an influence on peoples minds that speech and print can't even come close to. Internet you object? Without the streaming video it's on the level of the print media. If you don't believe me, put your TV(s) in the garage for 90 days and observe the general mental state of your household at the end of that time. Believe it or not, all humanity before the last two generations lived without this mental affliction. Want to enrich your daily life without spending any money? Junk the tube and do something else when you otherwise would have been watching!

Anonymous said...

What's the builder suppose to do when they can't move product? Sit on it like the used home market genius?

Everyone here is screaming for lower home price and when a developer does it you chastise them.

michael said...

from the video...

"they promised us that they would not sale the homes below market value"

they kept their promise sweetie pie.

Anonymous said...

IT'S NOT FAIR!

That's the sound bite of the sheeple getting slaughtered.

-------------------
2nd Sheeple Complaint: When we bought, they [the home builder] told us that they would never sell below market value.


DUMB SHEEPLE WAKE UP, when a builder holds an advertised public auction, the resulting prices ARE MARKET VALUE.

Below market value transactions are private non-public transactions such as when a parent sells a property to an adult-child at a price much lower than an advertised public sale would fetch.

keith said...

Not short DR Horton (I always disclose if I am) and 50% off of a house reeks of going out of business

this also looks like going out of business to me (in my personal first- amendment protected opinion)

http://finance.yahoo.com/q/bc?s=DHI&t=2y

Anonymous said...

Chase just cut the credit line on my cards.

One card went from $10,000 to $2,500.

The other card went from $4,500 to $1,000.

Both cards had $0 balance when the credit limit was cut and I don't have any late or delinquent accounts. All I have are student loans, an auto loan and one credit card at 25% of the limit. I can't imagine what they're doing to the FB's.

Stuck in So Pa said...

Another good reason to READ those mass mailings from the cc companies. They cut your limit and you don't know it, BINGO,you get a service charge to cover exceeding your limit!

Frank@Scottsdale-Sucks.com said...

"The sheep who does purches these crapy built homes will be rebuilding the whole thing in 10 years."

Seriously. These homes are total garbage. They were designed with the knowledge that people no longer lives in houses long-term anymore so why build them to last long-term? It's just like a car - most are built to survive the warranty period then it's all downhill from there.

Even the initial build quality is usually crap and full of mistakes. I remember moving into a cookie cutter McMansion in north Scottsdale in 2001 and the wiring was all screwed up, you turn on a switch in one room and the light comes on in another, etc.

kpflynn said...

I went to one of these auctions last week in San Diego. They actually ended up selling for shockingly high prices. They auctioned off 32 condos with the starting bids coming in at $200-250k for condos "previously valued" at 500-600k. Every single condo ended up selling in the 400-500k range. I wouldn't be surprised if the same thing happened here - the 50% price actually ends up being 15% off once the bids are over.

eric in vegas said...

"Chase just cut the credit line on my cards.

One card went from $10,000 to $2,500.

The other card went from $4,500 to $1,000.

Both cards had $0 balance when the credit limit was cut and I don't have any late or delinquent accounts. All I have are student loans, an auto loan and one credit card at 25% of the limit. I can't imagine what they're doing to the FB's."

---------------------

This is what's going to bring on a nasty recession. People won't be able to spend beyond their means even if they want to. Imagine people that have a 5k balance on a 10k card and they get a letter from their CC company saying their limit has been reduced to 1k. I don't see how we avoid a nasty recession unless the government plans on cutting everyone a check for $500 every month.

Anonymous said...

Seriously. These homes are total garbage. They were designed with the knowledge that people no longer lives in houses long-term anymore so why build them to last long-term?

Here in Texas, our shady Republican state government rewrote the laws to give their crony builder buddies full immunity against lawsuits. Homeowners have to take any complaints to a mediator, who works for the builders.

The day those laws passed, I swore I'd sooner live in trailer or a treehouse than buy one of those shitboxes.

Peter T said...

D.R. Horton is a business and can, therefore, sell their houses without sentimentality, for the price the market will bear. The alternative for them is to continue to bleed interest on the construction loans for years to come. I have no stake at Horton, neither long nor short, but in the past their anouncements seemed the least illusional of the whole bunch. Maybe they survive as one of the few and their stock as monopolist will increase.

Anonymous said...

still think it will take an average 24 years to reach the "bubble high again but maybe some years that you keep you will pay 18% of its then current value in property taxes but how low can its available sale price or capitulation price go?

Veronica Lodge said...

RE: I'm from the east coast and I've NEVER even heard of any of the towns listed. When does this housing blow up start to trickle into the big cities. I still see SanFran condos for $2mil, and Manhattan keeps going up. Greenwich CT where all the Hedge fund folk live, a small house $1mil. February 16, 2008 1:58 PM.

The boom towns listed are in the Xurbs -- miles and miles from job centers.

These future ghost towns were primarily sold as "affordable" housing and the buyers of these cracker boxes were mostly alt-A and sub-prime credit risks.

Most of these mortgages were minimum payment option, teaser rate, time bombs. Nearly all of the "home owners" bought at or near the peak, so they are all underwater in their loans. The walk-away statistics for these neighborhoods are in the double-digits for both good and bad credit risk loans.

Meanwhile, in the large metropolitan areas, the old rule of location, location, location still applies. Although property values are collapsing in the Xurbs, some big cities have actually experienced rising home prices, flat prices or modest declines -- at least for now.

The new lending standards will eventually cause all home prices to fall dramatically:

1. Minimum of 20% down payment.

2. Proof of income required.

3. Loans no larger than 3 times annual income.

4. Monthly loan, insurance and tax payments (and all other fees and taxes) totaling no more than 40% of income.

5. No more piggyback 2nd mortgages to avoid PMI.

6. No more interest only loans -- fully amortized loans only.

These tighter lending standards will knock over 30% of potential home debtors out of the market, so home prices will have nowhere to go but down.

All real estate prices will eventually follow the laws of physics and return to the traditional mean, which should equate to year 2000 prices within the next two years.

Expensive areas will still remain expensive, but only in relation to collapsing median prices.

V.L.

Anonymous said...

One thing that has not been discussed is the possibility of accomplices in the auction room that are bidding up the price to create an illusion of demand for the rest of the sheeple in the room. Possible? I'd say definitely.

Anonymous said...

Oh yeah, never hold an auction without shills or at least having good spotters who will call fake bids when the crowd is hot. You'll lose your shirt if you don't.