New Home Builders Cutting Prices

As the pool of buyers shrinks new home builders and continuing to cut prices. Buyers seem to be eating up the media hype as fast as it can get shoveled into their mouths. It’s making it difficult for new home builders in many areas and that includes the local marketplace.

Boulder itself doesn’t get too much impact from that as the most recent large project in the area, the Rock Creek subdivision in Superior, CO., finished it’s build-out in about 2003. However, areas such as northern Commerce City, Frederick and Firestone and even Erie, CO are seeing homebuilders making drastic price cuts. Centex homes, a builder with several projects in the Denver Metro area, has on one hand made it hard for Realtors working with them to get coop fees under certain conditions; while at the same time they advertise upwards of an 8% co-op buyer agent commission to get us to bring clients to their projects. Amazing.

As the Wall Street Journal reports recently, even builders who toss in granite counter tops (I guess no one told them granite is on it’s way out and quartz is the newest hot item for kitchen counters) or no-cost closings (buyers usually don’t have much to pay for when closing anyway so what’s the supposed big draw there?) home builders are getting into price cut wars. Where you say? California: Mertage Homes cuts as much as 40%; Arizona, same thing; Lennar: homes off the market entirely to wait out the market: Orange County, CA.

But listen folks, it’s not the same here. There still continues to be high demand for good property. Yep, it means that the trashed out rental condo built in 1975 with the same damn carpet and counters it’s had for 12 years isn’t going to bring you a tidy profit of 50% on your money since you bought it 24 months ago.

AND, the properties that are priced properly, presented well, marketed professionally and have been maintained thoroughly will sell. Yep, new home builders are in a bind but they’re part of the problem so for buyers who want a lot of house for the money, head on out east and have a go at it. The prices will eventually come back. Perhaps it’s time to pick a home to buy for the reasons we used to pick them: because it’s a place you want to live, a place you want to build a sense of community, maybe raise your kids, meet the neighbors and make a few friends. Pick a place to live.

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