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alstry (34.88)

California Homes 50% OFF Sale!!! "Unheard of Savings"

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February 11, 2008 – Comments (3)

D.R. Horton will be liquidating homes at 50% OFF in the next few weeks in CA.  The following is an excerpt from BigBuilder Online:

 Horton is focused on Southern California, where the company's new orders plummeted by 72% last quarter.

Promoting "unheard of savings" of up to 50%, the company is hoping dramatic pricing on Saturday, Feb. 16, and again on Saturday, Feb. 23, will move the 399 homes the company has carried in standing inventory for more than 12 months. Under the terms of the sale, buyers must close before the company's quarter ends on March 31.

http://www.bigbuilderonline.com/industry-news.asp?sectionID=0&articleID=655611

 Now imagine all of the homes in the above communities.  The recent comps will be 50% off.  What do you think that will do to the value of the remaining homes in the communities.  What about if they are leveragaed?  Can anyone hear the JingleMail jingle bells?

 

3 Comments – Post Your Own

#1) On February 11, 2008 at 7:37 PM, cabuilderboy (91.09) wrote:

Before everyone gets all worked up, it appears the sale is being held in 23 locations throughout Southern California (go to DR's website http://DRHortonUnAuction.com/), most of which are B locations at best. For example, of the 23 locations the majority are in the following: 2 in Bakersfield, 2 Chino Hills, 1 Victorville, 2 Desert Hot Springs, 5 Indio, 3 in Murietta, 3 in Temecula and 2 in Imperial Valley. All these areas were considered outlying areas just a few years ago. The investors gobbled up these homes when they were selling in the low to mid 200's, and drove up demand and prices to ridiculous levels. DR, like the other publics, paid way too much for the dirt, and when areas like San Diego and Orange County caught a cold, these place caught Pneumonia.Just keep things in perspective.

 

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#2) On February 11, 2008 at 8:20 PM, EScroogeJr (< 20) wrote:

I don't see these prices as a bargain. I've driven through Victorville, Indio, and Imperial Valley, and I'm not sure that I ever saw a more ghastly desert. Houses in this part of the world are NOT a good investment, not at these prices, not at one half, and not at one third. These locations are NOT going up. Buying something in Victorville and imagining that you're living in California is similar to buying a car with a dead engine and imagining that you're driving.

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#3) On February 11, 2008 at 8:54 PM, mickeyc21 (29.70) wrote:

cabuilderboy - they aren't in fancy locations so they aren't real?! They are very real to the poor people (literally poor now) who were dumb enough to actually be responsible and put cash down for their properties. Their equity is gone.

The pattern of this whole collapse has been that it has hit low priced properties first - the ones above have looked down their noses and laughed and then wham it has engulfed the higher priced properties.

You don't build in Manhattan beach by any chance? You remind me of a private there. 

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