I like the unusual viewpoints I read here, and thinking outside the box. The strategy you mention would work for a group of buyers who are interested in buying from one seller (or builder) during a normal or increasing market. San Diego does not fit the bill. You could try this in a town with normal appreciation, like Midtown, Nebraska, or Deerville, South Dakota.
In a market overvalued 20-50%, where we are already on the downhill side, I think you would still end up overpaying. Builders are already offering concessions; I’ve read Centex doing $100K reductions in Florida. More will be forthcoming.
Even if a builder gives you a 10% concession, next month he will have a 15% concession to move inventory, and you’ll have lost equity. I read about lots of people who are mad that their builders are selling for $50K – $100K less than they paid just a few months ago.
Personally, my husband and I have avoided new construction due to the small lot sizes. I don’t like homes so close to my neighbor that when I am on the patio or in my pool, they can see me from their upstairs window. I also prefer the spaciousness of a one-story. These preferences require larger lots, a factor that new builders have avoided, as they minimize the fixed cost of land and push us together like chickens in a hen house. I find the whole modern high-density building phenomena abhorrent.
When there is a builder who has houses on real lots (i.e. 1/4 acre to 1/2 acre lots), and prices are back to reasonable levels, I would definitely contact you about that idea! The idea is great, and its time will come.
