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I have a home for sale in Tampa, FL. I feel my biggest obstacle is the housing inventory. My house seems priced right and the location is good. I think my main problem is all the new houses being build near my neighborhood. When will they stop building?
In the real business world, home builder are doing it all wrong. It is all about supply and demand. Their continual building practice is only delaying their profit margin. If they let the supply of existing homes decrease then they would find themselves much better off in the short and end run. Instead they have let their greed get to far ahead of themselves. In my opinion, they should increase the prices of their new homes and decrease the amount of homes being built.
I have a home for sale in Tampa, FL. I feel my biggest obstacle is the housing inventory. My house seems priced right and the location is good. I think my main problem is all the new houses being build near my neighborhood. When will they stop building?
In the real business world, home builder are doing it all wrong. It is all about supply and demand. Their continual building practice is only delaying their profit margin. If they let the supply of existing homes decrease then they would find themselves much better off in the short and end run. Instead they have let their greed get to far ahead of themselves. In my opinion, they should increase the prices of their new homes and decrease the amount of homes being built.
If you have a resale in a neighborhood w/new construction, it will be much harder to sell because many home builders can offer incentives you can't. Also, if your a buyer and you had a choice between a home already lived in (assuming 2-3 years) and a new home w/your choice of everything, which would you choose?
Why are you blaming someone else for selling your home? Your either in 1 of 2 camps. 1. You've been in your house for many years w/a ton of equity and will get out w/some profit, or you bought at the peak 1-3 years ago and made a mistake and are trying to get out w/o totally losing your shirt.
Which is it?
Don't sell for another 10 years so you can ride this out and everything will work out.
I hate even speaking up in this part of the forum anymore because of how rude it has become, but on this one I will.
I moved from Tampa a year ago and still have investment properties there so I do know a thing or two about the market. I sold my personal home at the very end of last year within 60 days, and that was when the market was soooooo horrible, Tampa was the worst market, blah, blah, blah. Also, I owned my house for less than three years. I walked away with life changing money from it (seriously). Now, I do know that some people bought high, and I hope that was not you. Hopefully, you have enough equity to be able to sell it when you need to.
Ok, all that was leading up to something. I priced my home where all my neighbors were at first. I did 10K price cuts every week after that. Strangely enough, I had more interest in the house at the higher prices, people would follow me home from the grocery store when they heard I had a house for sale in the neighborhood. The thing is, I marketed the heck out of the place to sell it, I already had a new home in Georgia I wanted to move to. I told everyone, I put posters everywhere, I emailed the listing to everyone I knew. I let people in my home that I KNEW could not afford it. I had pool parties, I gave away my daughter's old toys, whatever it took to get people in to see it. I love my realtor, but he did nothing at all to market it, but he changed the pictures whenever I said to, went in the mls himself to change price whenever the whim hit me and showed the house while I was away.
Guess what? My former manager that I knew could not afford it came to look at it and loved it. She brought her sister over the same day who loved it and could afford it. We found out what she qualified for, we agreed on the price and my realtor handled all the paperwork and we worked out all the details.
My neighbors were not happy I brought the comps down, but I kept track of all the for sales in the neighborhood and the rest held out and got about 90% of their asking prices. I was on the market two months and they were all on the market for 9-10 months. Just two different ways to get what you want, ya know the saying, a slow dime or a fast nickel.
Just wanted to let you know there is hope there in Tampa. Now, if you know someone that wants a condo in Temple Terrace give em my info, because that one is next!
Thank you for the inspiring posting. I bought my primary house almost 7 years ago so I stand to make some money when my house does sell. I understand it was the greedy investors and home builder who raised the equity in my house. I am thankful for that blessing but at the same time, I am like everyone else in the situation who would like to get out and of this housing mess.
Here is my problem, 2 years ago, when the housing boom was in full bloom, I bought another piece of property in a different state hoping to use my equity from this house. I am sure it will sell, mabe for less than I hoped for but that is how it works sometimes.
I don't know about all bay area builders, but a Sr. VP of Centex went on local TV saying they are still building and that they've picked up the pace. It's what they do. And if you've looked into any of the community plans, much of the density is increasing to more units per acre. There are also several mega planned developments on the horizon as well. Sorry, it's not my idea, nor do I have any clue who's going to live in all those new houses.
I hope the right buyer for your home comes along really soon!
Thank you for the inspiring posting. I bought my primary house almost 7 years ago so I stand to make some money when my house does sell. I understand it was the greedy investors and home builder who raised the equity in my house. I am thankful for that blessing but at the same time, I am like everyone else in the situation who would like to get out and of this housing mess.
Here is my problem, 2 years ago, when the housing boom was in full bloom, I bought another piece of property in a different state hoping to use my equity from this house. I am sure it will sell, mabe for less than I hoped for but that is how it works sometimes.
That's kind of how I looked at the situation too. My house would not have doubled in two years if not for the boom, so I figured suck it up and sell for less than what I could have gotten (theoretically) and be very happy that I ran off with what I did. It was stressful having the house on the market, especially with everyone saying nothing is selling. But, it did, and it did pretty quickly. Good luck again! You can do it.
I don't know about all bay area builders, but a Sr. VP of Centex went on local TV saying they are still building and that they've picked up the pace.
This will only prolong the housing crisis and will bring no relief to the inventory numbers in Tampa. Many CEO's of large companies, especially in the housing business, only think short term. Their greed does nothing but to hurt them and their company in the long run. In the real business world, good CEOs plans out the future growth based on supply and demand.
Here is an example of a good business practice:
A business owner of a thriving wholesale retailer was growing so fast that she felt her only path was to hire more employees. She dreaded this thought as it would mean more managing time and headaches. She would have to deal with more sick employee time off, benefit overhead, personalities, and work schedules. Even though she enjoyed her growth and increase revenue, she did not want to sacrifice the extra time and effort to manage it.
Her solution to the problem was simple. She raised her prices on the goods and product she was selling. This caused two things to happen. First, she lost some of her customer base, but keep up her revenue by the increase profits of her products. Secondly, this caused her growth to slow down but it did not require hiring additional employees or any extra personal time to manage the business.
If home builders were smart, they would do the same. Increase their profit margin on their new houses and sell less. This would cause the inventory numbers to fall in the short term, but keep them profitable. When the market recovers, then they would be able to sell more. By them doing the opposite, meaning building more for less profit, they only keep the inventory number high. This only prolongs their own financial problems.
This will only prolong the housing crisis and will bring no relief to the inventory numbers in Tampa. Many CEO's of large companies, especially in the housing business, only think short term. Their greed does nothing but to hurt them and their company in the long run. In the real business world, good CEOs plans out the future growth based on supply and demand.
Here is an example of a good business practice:
A business owner of a thriving wholesale retailer was growing so fast that she felt her only path was to hire more employees. She dreaded this thought as it would mean more managing time and headaches. She would have to deal with more sick employee time off, benefit overhead, personalities, and work schedules. Even though she enjoyed her growth and increase revenue, she did not want to sacrifice the extra time and effort to manage it.
Her solution to the problem was simple. She raised her prices on the goods and product she was selling. This caused two things to happen. First, she lost some of her customer base, but keep up her revenue by the increase profits of her products. Secondly, this caused her growth to slow down but it did not require hiring additional employees or any extra personal time to manage the business.
If home builders were smart, they would do the same. Increase their profit margin on their new houses and sell less. This would cause the inventory numbers to fall in the short term, but keep them profitable. When the market recovers, then they would be able to sell more. By them doing the opposite, meaning building more for less profit, they only keep the inventory number high. This only prolongs their own financial problems.
Uhhh, sure....
So would you apply that philosophy to any consumer product then? Should GM, Chrysler and Ford raise prices on their automobiles, at a time when sales are going down and new low cost alternatives are being introduced into the market? Should Gateway Computers raise prices, even though they are getting slaughtered by other computer makers?
I think a building CEO who decided to do a full scale price increase right now in most markets would not last long with the Board of Directors.
The one big problem is that if you live in an area that gets a lot transferees who buy new homes, as opposed to locals just moving up into bigger homes, the builders HAVE to keep building spec homes because of the delivery times. Even the most aggressive builder can only deliver a new home in 90 - 120 days, not including site selection, color selections, floorplan changes, upgrades, etc.. Add all that on and now you have a 120 - 150 day window from site selection to closing (optimistically). Most transferees do not have that kind of time. So if you live in an area that gets a lot of transferees, builders like Centex would destroy what little sales they have if they cut inventories to the bone. It's a catch 22 for them and those markets. So they may have to trim inventory a little, but they are constantly "reacting" to the market instead of being ahead of the market (due to delivery times), and the only way they can react is to slash prices to keep that inventory intravenous going. They have to keep "cars on the lot", or ALL their potential buyers will go buy an existing home. Even if those "cars" have to be sold at cost or below cost. Pretty sight, ain't it?
The builders who will weather this storm and future storms are the ones who institute Lean Principles and Practices, including prefab components and greatly reduced workforces, and who can deliver homes in shorter periods of time and greatly increase inventory turns. Anyone who has wholesale, manufacturing or retail management experience knows that one key measurable of success is maximized inventory turns. Think about it. If you think of new homes in a line and could build and sell 5 homes from that line a year, as opposed to now only building and selling 3 or 4 homes a year from that same line (and do it with the same quality and better efficiency), your profits would explode. I'm really surprised more builders haven't latched on to this concept yet. Manufacturers have really embraced it over the last 5 - 10 years. I know of one big builder in the Midwest that has mastered it (and they are growing like crazy in slow markets). Last I heard their officers had started a consulting company and were taking their principles to builders in North Carolina.
I...My house seems priced right and the location is good. I think my main problem is all the new houses being build near my neighborhood. When will they stop building?
If it's priced right, then it will sell. If buyers are buying the new homes instead of yours, then it isn't priced right.
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