Silicon Investor (SI) -- The First Internet Community

STOCKTALK

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 : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (12802)	10/4/2004 7:22:40 PM
From: Jim McMannis	Read Replies (2) \| Respond to of 116555

RE:"These guys describe falling off a cliff -- they don't say that -- but not seeing it coming -- and being able to raise prices like they have for over a year without folks slowing buying -- there wasn't a smooth response at all for them to see" I recall some builders buying lots in Henderson for about $190k each from the BLM. Did Pulte buy any? Elroy, you know?

To: yard_man who wrote (12802)	10/4/2004 8:57:19 PM
From: russwinter	Read Replies (2) \| Respond to of 116555

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.