I kinda agree with them that the developers are getting greedy. There's been several precons recently where the developers have raised reservation prices significantly at contract time. 2 years ago I would have said that's the kiss of death for a developer but they're just sucking up the drop outs and reselling. The problem with that is that when the buyer sits for a year on his "reservation" for something that's his top end price of say $500K he's priced out of the market when the developer raises the price to 700K a year later and everything else has gone up. Had that happen to a lady and she could have had a DSF when she signed the reservation for a 500K condo but when the developer raised the price to 700K, all the DSF homes as well as comparable condos had gone up proportionately and she just couldn't afford more than 500K. Not much on 30A for 500K now.
She should have just bought when that was the price. I try to tell people all the time that the market is gonna go up uniformly, old or new construction, doesnt matter - just get in while you can.
I've got a client that just went to contract on a home in seacrest beach for 949K but the beauty is that the seller can't close until September.
How sweet. My guy has an assignment clause, has it relisted for $1.299 which is what comps are listed at now plus he has the whole summer's appreciation to sell it. His investment - 10K Earnest Money.
What a return! Actually have 2 of them with similar deals. The other only had only 2 months to sell so he may need to close but still got a good price and sat on 2 months appreciation for 10K. I'm pretty much over the preconstruction hullabaloo. Didn't Redfish condos break at 900K? Get out of here when I can get still get nice 900K condos like High Pointe ON THE BEACH. Go figure.
Now I'm seeing people trying to sell reservations. Do you believe this? Who would pay 20K for an bilaterally NON-BINDING agreement that somebody who can GET HIS MONEY BACK paid 10K for. I'd never let a client buy or sell that. Sounds like a can of worms. Same for those selling contracts on precons and they are wanting their 100K profit prior to the CO. Who's gonna lend somebody money to buy that? And what if the developer busts and you gave 100K to somebody thats riding around in a snappy new car with your money and you're stuck with a useless contract?
The best yet is a guy who called me up 2 weeks ago. He's been approached to purchase a "preconstruction tour" where he pays $300 dollars for a seat on a bus which takes him around to different Florida preconstruction offerings. No room, no food, nothing but a seat on the bus. I told him I'd take him around for $200K and it includes lunch
. This is getting crazy
kurt said:
Good stuff. :clap_1:
I've heard a few people say that around here that some developers are adding some appreciation in to their sales prices, and the margins are getting thinner.