Buy one house, get one free?!
June 5th, 2008 | by mbhunter |Curiouser and curiouser the housing market gets. The San Diego Union-Tribune (via Smart Spending) reports that Michael Crews Development is giving away $400k Escondido row homes with the purchase of a $1.6M+ San Pasqual Valley estate home.
That’s a huge concession. Mark Connal, vice president of realty, says:
We want to reduce our inventory … We’re prepared to bite the bullet. … Right now, every builder I know is selling houses at less than it costs to build them.
Bite the bullet, indeed. This is telling. Michael Crews Development is running for cover, and their competitors are taking it on the chin. If they’re unloading at a loss now, they must not expect things to get better soon.
This buy-one-get-one-free offer seems pretty smart as a form of damage control. The high-end houses like these have the furthest to go down. This deal gets two properties off of the builders’ books — a good thing to do when there’s eleven months’ worth of inventory on the market.
If you’re looking to buy a house, I think a little patience will pay off. The real estate market isn’t very happy right now, and will be more downtrodden next year.
2 Responses to “Buy one house, get one free?!”
By netdebt on Jun 5, 2008 | Reply
Buy one get one free???? in Real Estate.. things must be pretty bad for these builders.
By Mrs. Micah on Jun 5, 2008 | Reply
With products that pricey things must be rather dire. If they desperately need to get rid of them it’s a good gimmick, but goodness.
Smart homeowner takes the “free” house and resells it for part of what it’s worth (taking into account fees, taxes, transfer) and then uses that money for investing or the like. Maybe. I don’t know if smart homeowner buys the really expensive house in the first place.