PHM is asking (second day) their order "backlog" to come in and sign owner occupied addendums, and increase deposits, in exchange for price concessions. The question is how would speculators react to the new reality that prices aren't just going straight up, but actually down? Maybe a lower price would be a psychological break point? LV cancellation rate ran over 75% in Sept, 60% 13 weeks avg. was 60%. Nationwide 13 week avg cancellation was 18%, 4 week is 19%. The deposit ($5,000-$25,000 for high end) is treated by these speculators as nothing more than a expired call option, and now PHM is trying to increase the call premium in a declining market, good luck, this is just the beginning. There was also an admission that people were cancelling because they can't sell (flip) their older properties. Very odd conflicting statement, given that they said the LV is OK.
Unsold LV inventory is 15,000 homes versus 5,000 earlier this year, and they claim it's "only because we specifically got too aggressive on LV pricing". There are 40,000 platted lots now available in LV, nearly double last year.
Hinted that "hurricanes" were delaying closings in Florida, more color later. |
