A few days ago the Builders Association of the Twin Cities released their report for 2008, and no big surprise, the numbers were not great. Permit requests came in at 5397 compared to 8971 in 2007, a 40% drop! If you take a look at the report, the five year report of permitted units is hard to fathom. In 2004, there were 18,591 total permits issued.
Currently I am working with a few buyers who are considering new construction. Some builders are offering some real deals who understand where the market is trending. However, there are other builders out there holding on, keeping their prices high and refusing reality. And of course there are the builders who hung on too tight and are now out of business. The best thing I can tell you is negotiate. If the builder won’t, then move on to someone else.
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I am a surviving builder in Bergen County New Jersey and also a Realtor for 32 years. The key to suscess is simple. You sell thing for what they are worth if you are a builder. If you don’t and hold out, you are no longer a builder, but a speculator, gambler, crystal ball reader, very rich and don’t care about your money or well being or at last, just a fool.
Great analysis…so simple. Once you stray from market conditions, you enter the world of la-la land.