Stopped by the Sales Office of Redwood (Standard Pacific HOmes) at Wolf Creek in Temecula this weekend out of curiosity (I work in La Jolla so Temecula is too far away). The sales manager said that SP had a goal of selling 200 homes across the division (which I think was LA, SD, OC and Riverside Counties) by the end of next week and they were offering “deep discounts” to make it happen. This development had four models ranging from 3300 to 4500 square feet initially priced from $555K to $703K, but they were discounting $60-$80K (about 10%) right off the bat. This brings the price to about $150/sqft (no upgrades). They were only on their second or third phase out of 8 in this development, so I imagine deeper discounts will be coming later.
Is this consistent with what others are seeing from the builders elsewhere in SD County, or is this degree of discounting only happening in areas like Temecula, the IE, etc? Any ideas on how much further the builders will need to discount to clear their inventory?
4500 sqft homes in Avaron (Del Sur) are now in the $1.2 to $1.3 range. some folks paid as much as $1.4-$1.8 for the exact same floor plans just 6-9 months ago.
to me this means some builders are finally admitting how futile it is to swim against the tide of declining house prices. they are realizing they must sell now; otherwise, they will be stuck with this inventory for years…besides they must be under incredible pressure to reduce the spilled red ink on their balance sheets and avoid another quarter of losses
Out of curiosity, my wife and I took a look at some of the homes at 4Closure Ranch (wishful thinking?) this past weekend. As it was our first time, I’m not sure what they’ve told folks in the past, but they had the lowest cost Silhouette homes listed for “low-700’s” and they actually were starting at $680K.
Given the price of land and the cost to develop the land, some of these homes are coming in at about cost to build in some developments (not everywhere so I will not try to name developments but there are a few out there).
In a few of these developments to go much lower the develper will be looking at a liquidation type of situation.
Things could get interesting….
I would say if you can build (permits, Land development etc… for less than 100 sqf) I want to hire you to build on my piece of land PLEASE !!!!..
don’t bother negotiating. don’t even bother going to their sales office. let them sit and rot. even if this batch of 4closure ranch homes are all sold out, you’ll still have plenty to chose from. sit back and relax and watch Team Builders stab their customers of today several times in the back this time next year.
don’t bother negotiating. don’t even bother going to their sales office. let them sit and rot. even if this batch of 4closure ranch homes are all sold out, you’ll still have plenty to chose from. sit back and relax and watch Team Builders stab their customers of today several times in the back this time next year.
I don’t make >$200K/year, so I’m not certainly not going to buy anything for $700K. We also don’t need any 5 bedrooms + study. That seems really nutso for most people. I’d rather have a four bedroom with a larger yard, where the master bedroom closet doesn’t dwarf the smaller bedrooms. Heck, my wife keeps arguing that we really only need three bedrooms and we’ll put our two kids in one room.
My wife has older sisters who shared a room and always envied their time together. We’re many years off from the teenager stage, but I can certainly imagine it could get tough.
” Given the price of land and the cost to develop the land, some of these homes are coming in at about cost to build in some developments”
Nor-La-Temcu-SD-GUY, please not the same tired industry argument. Land prices drop when no one buys. Builders will just have to cut their profit margins on their work. Tough for them, but that’s how it works.
