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Kurt

Admin
Staff member
Oct 15, 2004
2,233
4,925
SoWal
mooncreek.com
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.
 

Cork On the Ocean

directionally challenged
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. :eek: 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. :rotfl: 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. :D 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.
 
Last edited:

Paula

Beach Fanatic
Jan 25, 2005
3,747
442
Michigan but someday in SoWal as well
Debbie:

Thanks for the information on St. Joe. I think their biggest challenges (which I'm betting that they'll succeed at) are to (1) convince people to purchase high-end properties inland in the Panhandle (or Great Northwest as they call it); (2) preserve the natural beauty; (3) build infrastructure; and (4) encourage businesses to take root in the "Great Northwest" so that people who want to live inland also have plenty of resources. Joe is in it for the long-term, so they have time to plan out the future of the Great Northwest. Let's hope they do it well and beautifully.

Best,
Paula
 

Cork On the Ocean

directionally challenged
Hi Paula,

I'm also betting on Joe. I thinks they know what they're doing. I can only tell you that everything they've done here has turned to gold. There doesn't seem to be any shortage of high end investors in this area. Every year I'm amazed at how many people continue to flock to these communities in spite of the exorbitantly rising prices. From what I hear, we are still priced less than comparable communities around the state. One of my realtors from Boynton told me that homes that are 6 million here would cost 25 million in the Miami area so it looks like we still have room.

Regarding on the preservation of our beauty, I'm relying on our county planners who have done a pretty good job so far. Also it seems like JOE communities do appear to be doing a pretty good job so far from not turning us into miles of pavement. Lots of trees and natural vegetation in both Watercolor and Watersound.

Their donation of the land for the airport and the development of pier park, while certainly not benevolent, seems to indicate an awareness of the need for infrastructure. I know we're all worried about the infrastructure but their communities so far seem to be following new urbanistic principles which will hopefully keep our roads from becoming the mess that 98 is in west Destin.

Not sure about the whole Great Northwest thing but people sure know and appear to love the Panhandle. We're making news everyday and the experts are projecting expansive growth from the beaches to I-10. When I compare Freeport to other bayside cities through the state, I cant believe that it's still so undeveloped, at least for now. Nobody ever knows for sure but it looks like you've made a good choice.

Take care,

Debbie

Paula said:
Debbie:

Thanks for the information on St. Joe. I think their biggest challenges (which I'm betting that they'll succeed at) are to (1) convince people to purchase high-end properties inland in the Panhandle (or Great Northwest as they call it); (2) preserve the natural beauty; (3) build infrastructure; and (4) encourage businesses to take root in the "Great Northwest" so that people who want to live inland also have plenty of resources. Joe is in it for the long-term, so they have time to plan out the future of the Great Northwest. Let's hope they do it well and beautifully.

Best,
Paula
 

Paula

Beach Fanatic
Jan 25, 2005
3,747
442
Michigan but someday in SoWal as well
Hi Debbie:

I think so, too. I may increase the amount I invested a bit...

Other things to consider:

St. Joe's is politically in good relationships with Bush in Florida -- if the state ever goes democrat then that may have an impact on St. Joe and development (although my guess is their ready for any changes in political parties -- they seem pretty smart).

Another risk would be any unethical behavior at the top in St. Joes -- but that's hard to predict.

Another risk is that I've read that some of the bigger homes (regular bigger homes, not the bigger homes on the beach) may have reached their peak and that consumers are looking for slightly smaller homes. So, I hope St. Joe's is investing in the middle-range homes as well (which would now be considered those selling for $500-$1,000,000) on 30A and the nearby areas (as strange as that sounds). Someone on this board (you?) mentioned that there's a shortage of those types of properties for sale.

Best,
Paula
 

Cork On the Ocean

directionally challenged
Hi Paula,

Funny you mention the political alignments as I've wondered the very same thing. I'm sure if you and I have considered this issue, their paid strategists have already been there.

Ethics in the ranks? I doubt if one or two bad apples could make a difference in such a megacorp unless they compromise laws. In a different life I was a pharmacist who investigated drug companies for the state. It seemed the only thing that could touch the big boys was bad legal problems. Even then, if they were too litigious or expensive to prosecute, I saw many cases "settled" or "dismissed" without litigation so being a megaplayer has it's benefits I guess even when there is corruption.

They do seem to be addressing mid-price needs with developments such as Palmetto Trace in PC. It wasn't me that mentioned the shortage of mid-range homes but I agree. There are still some very nice homes on 30A from 500-1 mil but there won't be for long. Since Joe had plans for west bay area once the airport is approved, I suspect we're going to see some mid-range homes in that area by them. There's a finite number of high end investors (albeit a large number apparently) and Im sure JOE is aware of that.

Take care,

Debbie
 

beachmouse

Beach Fanatic
Dec 5, 2004
3,504
741
Bluewater Bay, FL
I don't think there will be a political question down the road. Politicians come and go all the time in Tallahassee, especially since term limits kicked in. With the current term limits, you just don't get a handful of politicians developing their own little fiefdoms anymore like they could when they could dig in and stay in office for 20+ years. The homebuilders and home builder association lobbyists are there permanently, and know how to get what they want from the politicians, no matter which party is in charge.
 

Paula

Beach Fanatic
Jan 25, 2005
3,747
442
Michigan but someday in SoWal as well
Useful comments. Yup, I'll invest a little more in St. Joe's. My sister just invested some money in Joe as well because they've visited the area and seen all the development and did their own research as well. It's an interesting stock to watch anyway, especially for those of us who love the area and follow what's going on in the Panhandle (oh, "Great Northwest").
 

Philip_Atlanta

Beach Lover
Mar 1, 2005
140
1
www.rosemaryrental.com
Bob said:
St. Joe is the best. They are selling land bought for near nothing for a fortune and reinvesting, tax free, via 1031 law, for more land that is dirt cheap. What a beautiful business model.

Where is JOE "reinvesting for more land that is dirt cheap"? Just curious where they are heading down the road..

Oh, and "Cork On the Ocean", great information - thank you.
 

Smiling JOe

SoWal Expert
Nov 18, 2004
31,648
1,773
Philip_Atlanta said:
Where is JOE "reinvesting for more land that is dirt cheap"? Just curious where they are heading down the road..

Oh, and "Cork On the Ocean", great information - thank you.
I know that JOE has been buying huge acerage in SW Georgia, some river-front but mostly interior.
 
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