A Sign Of The Times

While driving tonight, I heard an interesting advertisement from one of the national home builders in our area. It essentially says that you can buy a home from them with a $1 downpayment. The fine print says that you have to put a binder down with the contract but it is fully refunded less $1 at closing.

This is the same company that two years ago offered several models, would only allow you to choose between 3 exterior paint combinations, a handful of upgrades and no interior painting. Essentially, they were saying , "If you don't like the home like this, that's ok because there are 8 people lined up behind you who will take it as is.

I'm thinking the $1 "online special" is a sign that the time are a'changin'. The market is shifting in favor of the buyer, and hopefully the homebuilders socked away the last few years of profit to get them through the coming months where they are going to have to move some inventory and get it off their books.

I'm guessing that these guys, since they own the mortgage company, figure they can offset some of the real estate losses or anticipated losses through their financing divisions.

It isn't that I'm a doom and gloomer on real estate. In fact, I think some people are having knee jerk reactions to the market. If you buy real estate at a fair price, and can afford to hold on to it, your money is probably as safe there as in any other investment over a long period of time. But, the builder's aren't going to be able to keep pumping out the houses in our area like they have been over the past several years. People are going to be laid off. Contractors are going to be hunting down work. And the cost and time period for the consumer are going to be reduced.

Overall, it isn't a bad thing. They've had quite a few years of plenty, and hopefully have planned for decreased margins. For homebuyers, it's a great time to be house shopping.