Comments on: Competitive new construction and schadenfreude

By: mbhunter

mbhunter — Sat, 01 Sep 2007 05:53:08 +0000

VAGal: Those are excellent points. Having lots of folks that were building the homes now unemployed would be unfortunate. I agree with that, and the post didn’t convey that because I didn’t think of it when I wrote the post. Didn’t think enough on that point.

I’m not sure how the economy would absorb these folks. The ones that stand a better chance of moving to employment outside of the homebuilding industry are the ones who have other skills to fall back on. But that’s true regardless of whichever industry goes south. Which is why it’s always a good idea to learn how to do something else before you actually need to.

By: dong

dong — Thu, 30 Aug 2007 03:56:13 +0000

I don’t think we’ll really hit any kind of bottom until next year if that. Housing prices are too sticky on the way down. I see a huge glut of inventory come winter. While expect some to pull their listings, there are still going to be many people who need to sell… It’ll be a great time to be a buyer.

By: Angie Hartford

Angie Hartford — Sat, 25 Aug 2007 18:11:37 +0000

You’ve done a good job, by being in a position where you can afford to wait, then name your price. Congratulations!

By: Kevin

Kevin — Thu, 23 Aug 2007 13:22:14 +0000

Agreed. I’d love to be in the rental business — but I still can’t find properties in my area that would generate positive cash flow. Prices are still out of balance even on existing homes.

I don’t think we’ve bottomed yet, especially with credit drying up for all but the very best credit risks. As buyers get pushed out of the market and more foreclosures go through, prices are going to fall a bit more.

Not in every market, maybe, but on average: the bubble hasn’t burst but merely subsided a little.

By: Michelle Hope

Michelle Hope — Wed, 22 Aug 2007 23:22:49 +0000

Banks aren’t even willing to take a loss on foreclosures yet! At least not here around Los Angeles. I see a lot more bank-owned foreclosures on the MLS, but the prices haven’t come down AT ALL. Maybe if you find a desperate seller before the bank forecloses . . . but, I think we should just wait it out.

By: VirginiaGal

VirginiaGal — Wed, 22 Aug 2007 14:16:13 +0000

Just remember that people who work for a home builder might be seeing things a little differently right now. Getting a house under cost is a great deal, but be aware that not all the $ in the construction market goes to the guy managing the company.

You’re also looking at framers, masons, painters, etc.; guys who might just have the one skill and no fall-back resources – guys who end up on unemployment (and costing you and me in the end) because even though they are looking for work, no one is hiring.

Maybe some of the large corporations which have been raking in money over the past few boom years could stand to take a hit, but don’t forget about the “little guys” who could take the brunt of the financial pain from this change in the market. And don’t forget that the cost of materials has gone up a great deal in the past few years, thanks to demand from the global economy – China being the top one sucking in materials and thus raising prices globally.

“At Cost” or below does have a “cost” to more than just the home buyer.