Discounts on standing inventory of new construction

[Dr. CA Real Estate]

Have you personally been up to teresenia? What did you think?

I have.  The layouts are awesome, the location not so much.

Even though they?re tightwads Shea does design good homes. What?s wrong with the area? No good views like other parts of Lakeforrest?

 

[aquabliss]

Have you personally been up to teresenia? What did you think?

I have.  The layouts are awesome, the location not so much.

Even though they?re tightwads Shea does design good homes. What?s wrong with the area? No good views like other parts of Lakeforrest?

On the way into the community there is an exposed power station on the corner of Peachwood and Trabuco, kind of an eyesore. 

Then when you?re going up the hill, you pass a lot of older homes and condos / apartments.  I think I saw one house that had a visible big blue tarp covering some stucco damage. 

It?s a much nicer feeling when you enter Baker Ranch vs. this community.  After you pass the jail of course.

 

[Dr. CA Real Estate]

William Lyon founder died a week ago.
RIP

 

[CogNeuroSci]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Yeah, more so for the publicly traded home builders the private guys like Irvine Pacific and California Pacific are sticking to their fixed broker co-ops.

Hi everyone, this is my first post on Talk Irvine. I've been looking around on this forum on and off for about the last 3.5 yrs.

Martin, can I ask what are some of the public builders? So Cal Pac and Irvine Pacific are privately owned. What about Lennar, Brookfield, TRI Pointe, Shea, Pulte, KB, Richmond American, Taylor Morrison, Toll Brothers, etc?

 

[CogNeuroSci]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Kris, where are you getting the 5% broker co-ops? My wife and I have been looking at houses in Juniper (Richmond American), some Lennar communities, and a bunch of Cal Pac communities, and they all offer 3-4% or a flat amount that's close to 3%.

 

[usctrojancpa]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Yeah, more so for the publicly traded home builders the private guys like Irvine Pacific and California Pacific are sticking to their fixed broker co-ops.

Hi everyone, this is my first post on Talk Irvine. I've been looking around on this forum on and off for about the last 3.5 yrs.

Martin, can I ask what are some of the public builders? So Cal Pac and Irvine Pacific are privately owned. What about Lennar, Brookfield, TRI Pointe, Shea, Pulte, KB, Richmond American, Taylor Morrison, Toll Brothers, etc?

Welcome back to the forum. Lennar, Brookfield, TriPointe, Pulte, KB, Taylor Morrison, and Toll Brothers are publicly traded builders while Shea and Richmond American are privately owned.

 

[usctrojancpa]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Kris, where are you getting the 5% broker co-ops? My wife and I have been looking at houses in Juniper (Richmond American), some Lennar communities, and a bunch of Cal Pac communities, and they all offer 3-4% or a flat amount that's close to 3%.

Most builders are offering 3-4% or a fixed amount around 3% broker co-ops based upon the average sales price. There have been times where a few builders (namely Lennar) offer a slightly higher 4-5% broker co-ops on quicker move-in homes that they want to close before the end of their fiscal quarters.

 

[Mety]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Yeah, more so for the publicly traded home builders the private guys like Irvine Pacific and California Pacific are sticking to their fixed broker co-ops.

Hi everyone, this is my first post on Talk Irvine. I've been looking around on this forum on and off for about the last 3.5 yrs.

Martin, can I ask what are some of the public builders? So Cal Pac and Irvine Pacific are privately owned. What about Lennar, Brookfield, TRI Pointe, Shea, Pulte, KB, Richmond American, Taylor Morrison, Toll Brothers, etc?

Welcome back to the forum. Lennar, Brookfield, TriPointe, Pulte, KB, Taylor Morrison, and Toll Brothers are publicly traded builders while Shea and Richmond American are privately owned.

Welcome back? Are you feelin' what I'm feelin'?

 

[CogNeuroSci]

I'm pretty sure Martin didn't mean it that way. And yes, I understand you think I'm that BTB person. But like I said elsewhere, I am not him or that YF person.

My name indicates I have a background in brain and behavior. The brain is designed to see pictures, so accordingly, I have an interest in design. I think as time goes on, forum members will be able to discern a pattern in my posts: a psychological perspective embedded in statements/opinions about design.

That's what I can offer the members on this forum (in appreciation for all the things I've learned from you guys here). The focus on human factors is something I haven't seen yet on this forum, and so I doubt YF or BTB offered this kind of perspective (although I'm not trying to demean them).

 

[Mety]

I'm pretty sure Martin didn't mean it that way. And yes, I understand you think I'm that BTB person. But like I said elsewhere, I am not him or that YF person.

My name indicates I have a background in brain and behavior. The brain is designed to see pictures, so accordingly, I have an interest in design. I think as time goes on, forum members will be able to discern a pattern in my posts: a psychological perspective embedded in statements/opinions about design.

That's what I can offer the members on this forum (in appreciation for all the things I've learned from you guys here). The focus on human factors is something I haven't seen yet on this forum, and so I doubt YF or BTB offered this kind of perspective (although I'm not trying to demean them).

Whether you are YF/BTB person or not, we're glad to have you here. Some people have accused me of being YF/BTB for quite some time and I think some still think I am. I believe he is way more intellectual than myself so it's been kind of fun people accusing me like that. I also wish he would be back since he shared real good stuff here. Anyways, thanks for your inputs so far. Really helpful stuff.

 

[Agent Joe]

Current promotions for most builders as far as commission goes is 4-5% of purchase price.

Kris, where are you getting the 5% broker co-ops? My wife and I have been looking at houses in Juniper (Richmond American), some Lennar communities, and a bunch of Cal Pac communities, and they all offer 3-4% or a flat amount that's close to 3%.

Since sales are slow, some builders i.e. Lennar are willing to negotiate broker co-op these days. Everything in RE is negotiable.

 

[potsticker]

Stopped by the Reserve today in OH. Chatted with sales folks at Terra, Ravello, Como, and Vivo. Terra and Ravello said no concessions at all on their standing inventory. Como and Vivo said maybe a small amount towards closing or design center. Evidently sales at the Reserve did not slow down.

 

[usctrojancpa]

Stopped by the Reserve today in OH. Chatted with sales folks at Terra, Ravello, Como, and Vivo. Terra and Ravello said no concessions at all on their standing inventory. Como and Vivo said maybe a small amount towards closing or design center. Evidently sales at the Reserve did not slow down.

Yeah, new home sales have definitely picked up in the past few months so builders are more reluctant to offer up any material incentives, especially Irvine Pacific which loathes giving away incentives even for standing inventory homes.

 

[OCLuvr]

Somehow, I see that homes are not selling as fast in Irvine.

 

[potsticker]

Somehow, I see that homes are not selling as fast in Irvine.

Sales are brisk for homes priced right. There's a supply issue here - no one is selling. At the Reserve, they're selling view lots at a huge premium, but people are buying. The best time to buy was last Fall. We looked at a home at Terra for $1.29m and they were offering $50k in design center credits to close the deal. Current phase - not standing inventory. The same floor plan in a less desirable lot location is now $1.6m today.

 

[OCLuvr]

I guess builders?especially, Irvine company?can keep the standing inventory and still sell future phases at a premium, but not everyone. E.g. people are ready to sell at 2016 pricing in Great Park but no buyers yet.
https://www.redfin.com/CA/Irvine/102-Mongoose-92618/home/102905210?utm_source=ios_share&utm_medium=share&utm_campaign=copy_link&utm_nooverride=1&utm_content=link

I also see correction in Stonegate?e.g. following houses for going for 1.25M+ in 2018.
https://www.redfin.com/CA/Irvine/62-Crestwick-92620/home/58556492?utm_source=ios_share&utm_medium=share&utm_campaign=copy_link&utm_nooverride=1&utm_content=link

 

[usctrojancpa]

I guess builders?especially, Irvine company?can keep the standing inventory and still sell future phases at a premium, but not everyone. E.g. people are ready to sell at 2016 pricing in Great Park but no buyers yet.
https://www.redfin.com/CA/Irvine/102-Mongoose-92618/home/102905210?utm_source=ios_share&utm_medium=share&utm_campaign=copy_link&utm_nooverride=1&utm_content=link

I also see correction in Stonegate?e.g. following houses for going for 1.25M+ in 2018.
https://www.redfin.com/CA/Irvine/62-Crestwick-92620/home/58556492?utm_source=ios_share&utm_medium=share&utm_campaign=copy_link&utm_nooverride=1&utm_content=link

Lennar has also cut back on their incentives too as they've been selling more homes in the past few months. There is definitely more velocity of transactions in the $1m to $1.5m market in the past 1-2 months. That being said, buyers in that price range are still picky (as they should be) and have homes to pick from than the sub $1m buyers.

 

[OCLuvr]

Thanks USCTrojan. How do you see core logic prediction playing out for Orange County?https://www.google.com/amp/s/www.ba...these-markets-will-be-hit-hardest-51594082678

 

[usctrojancpa]

Thanks USCTrojan. How do you see core logic prediction playing out for Orange County?https://www.google.com/amp/s/www.ba...these-markets-will-be-hit-hardest-51594082678

Hard to say what how the market will be in the next 6-12 months as it'll depend on a lot of variables like inventory levels, interest rates, virus vaccine/treatment status, job situation, will states be fully open, etc.  The pick up in the real estate market after the big pause button surprised me a bit (I'm dealing with any multiple offers on both sides). One big variable will be inventory levels because there are a lot of sellers that pulled their listings off the market when the stay-at home order got issues and most of those sellers have not relisted their homes yet.

 

[OCLuvr]

I agree with you, but I guess with $600/week going down to $200/week + fall could be worse than summer for infections...so, even if inventories stay low, prices could also soften.