sgip
Well-known member
Every housing downturn pits new home sellers against 1st and 2nd phase buyers who are able to capitalize on significantly higher prices the builders find themselves in phases 3 and on. I saw an example of a listing like this today.
Lennar is building "The Farm" in San Juan Capistrano.
https://www.lennar.com/new-homes/california/la-orange-county/san-juan-capistrano/the-farm
Nice homes, decent area, beach close selling in the 1.8 to 2.3 range right now. They've had their first phase closings in the last 2 weeks or so. Already there are two listings from speculators trying to cash out.
Because the background data isn't yet found in most Title company databases I was only able to find the original purchase price on one of these properties. Congratulations are in order to the sellers of this property:
Phase 1 closed price - $1,595,000. Current list: $2,388,000. Builder is selling these today at $2,200,000 base model so even if this seller pushes the price to $2,100,000 that's a pretty sweet MAXIMUM ROI!!!
https://www.redfin.com/CA/SAN-JUAN-CAPISTRANO/26155-FARM-RD-92675/home/176990808
One thing that surprises me about this tract is the sheer number of ready to close homes. Yes, rates have gone up. Perhaps some fell out because of the turn in the mortgage market. Perhaps some fell out due to recessionary job loss. Given the phase 1 prices versus what the builder has them listed for today, I'd close on the home - job or no job - and still come out way ahead.
When early phase buyers flip their homes, it's very, very difficult for the on-site sales office to compete. At some point they will have to if enough closed buyers begin to put up "For Sale" signs.
Any sign of this going on in the GP? Eastwood? etc?
Lennar is building "The Farm" in San Juan Capistrano.
https://www.lennar.com/new-homes/california/la-orange-county/san-juan-capistrano/the-farm
Nice homes, decent area, beach close selling in the 1.8 to 2.3 range right now. They've had their first phase closings in the last 2 weeks or so. Already there are two listings from speculators trying to cash out.
Because the background data isn't yet found in most Title company databases I was only able to find the original purchase price on one of these properties. Congratulations are in order to the sellers of this property:
Phase 1 closed price - $1,595,000. Current list: $2,388,000. Builder is selling these today at $2,200,000 base model so even if this seller pushes the price to $2,100,000 that's a pretty sweet MAXIMUM ROI!!!
https://www.redfin.com/CA/SAN-JUAN-CAPISTRANO/26155-FARM-RD-92675/home/176990808
One thing that surprises me about this tract is the sheer number of ready to close homes. Yes, rates have gone up. Perhaps some fell out because of the turn in the mortgage market. Perhaps some fell out due to recessionary job loss. Given the phase 1 prices versus what the builder has them listed for today, I'd close on the home - job or no job - and still come out way ahead.
When early phase buyers flip their homes, it's very, very difficult for the on-site sales office to compete. At some point they will have to if enough closed buyers begin to put up "For Sale" signs.
Any sign of this going on in the GP? Eastwood? etc?