Massive Price Cuts on New Homes (short sales, foreclosures, neighborhood)

[smily4242]

I am seeing some major price cuts on existing new homes by various builders in the planned communities in the Northeast side of town. Are these price cuts affecting used home sale prices?

[predatorprey]

Yes

How does a existing home sale compete against new construction?

Lower their price.

[plaidfrogg]

Thanks for asking this, as I have the same question. Hope you don't mind my piggy-backing here....

We've been looking at re-sale homes (old and new), brand new inventory homes, and possibly a new-build. With the deep discounts and incentives, it's tough to know which is the best value in the current market....not just the sticker price, but the longer-term costs.

One realtor we met (at a re-sale open house), said new homes are better value b/c they usually come with 10-year warranties vs. the 1-year limited warranty a re-sale usually comes with. Then there's other considerations like taxes/MUD.

[Benning]

There is a neighborhood out this way, Gosling Pines, I believe, that have posted signs up and down Gosling offering two-year all home maintenance coverage for free when you buy one of their houses.

[gold dust]

I'm a stickler for the more established developments ... with some of the newer stuff, it's anyone's guess what it may become. I used to think I wanted a brand new home ... but I love my 1994 home! : )

[surfs1st]

It's a double edge sword, on the new side you get the warranty and it's tailor made (inside at least), but as another poster said you pick up high taxes and are generally farther away from you work location (urban sprawl).

Older homes have lower taxes, are usually better at commutes and are not cookie cutter layouts, but often have to be upgraded or renovated per your needs.

Me I like older homes, I can't stand someone having the exact same home I have right around the corner with the exception of a paint color or brick facade. I don't know, it just seems so mass produced.

[chris_ut]

Originally Posted by surfs1st

I don't know, it just seems so mass produced.

You mean like everything else you own? I never understood this argument. You probably own a vehicle that 20% of your neighbors have, shop for clothes at the same places, have the same television and phone and ipod but god forbid your house should look similar.

[surfs1st]

Originally Posted by chris_ut

You mean like everything else you own? I never understood this argument. You probably own a vehicle that 20% of your neighbors have, shop for clothes at the same places, have the same television and phone and ipod but god forbid your house should look similar.

When my car or clothes start costing $300,000 each then I'll be concerned about having the same car as my neighbor or wearing the same tie as someone at the office.

Until then I'd like to think that kind of money buys some individuality, but it's just an opinion.

[Lake Conroe resident]

Originally Posted by smily4242

I am seeing some major price cuts on existing new homes by various builders in the planned communities in the Northeast side of town. Are these price cuts affecting used home sale prices?

Yes; what's going to affect it more are the large amounts of foreclosures that have come onto the market, with only more on the way.

This affects the new home market and the re-sale market equally. Until all the foreclosures in the area have been filtered through it's going to be hard for any price appreciation anywhere. Unless you want a very unique property where there's nothing else like it,(example; pristine home on 1+ acres, with a 6 car garage, swimming pool and detached in-laws quarters with lake access) or want to be in a very desirable area where there are no foreclosures/short sales, I would say your chances for deep discounts are plentiful.

[Huckleberry3911948]

major and massive dont work for me. FMV works for me. in bout 1 year despite the bailout game prices are guna come down big time.