SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : The Residential Real Estate Crash Index
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: microhoogle! who wrote (27997)3/10/2005 11:55:03 PM
From: GraceZRead Replies (1) of 306849
 
In northern VA there is some speculation. Especially in new town houses and condos.

Here as well in Maryland. It is not unusual to drive into a new neighborhood with just finished houses that all have for sale signs. The builders won't break the ground until there is a buyer, so the houses that are just finished are being sold not by the builder, but by someone who speculated on the price rising from the time they put down the deposit until it was finished.

In a weird sort of way, they serve a purpose in that individuals who intend to live in a house do not want to commit to a house pre-construction not knowing if interest rates will rise substantially before they can close, or whether or not the builder will get behind schedule or live up to their promises. They seem to want to buy only houses that are finished (so they can get conventional financing I suppose) and they are willing to pay the premium to the speculator to use their money to secure the deposit. The speculator assumes some of the risk associated with construction and for that they are rewarded.

Just tonight a client asked me if that kind of speculation was appropriate for them because they had a friend who was "investing" in pre-construction. I said, "Not this late in the cycle." What I didn't say was "Never". The friend was someone who has been intimately involved in the RE business as a house stager for the last ten years and is quite familiar with the risks. She is someone who goes into 2-10 million dollar houses and prepares them for sale.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2026 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News