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New-Home Prices Take Biggest Dive Since 1970
(By Justin Sullivan -- Getty Images)
SOURCE: commerce Department | By Tobey - The Washington Post - November 30, 2007 TOOLBOX
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As the market weakens, he said, some smaller builders, such as Levitt & Sons in Florida and Neumann Homes in Chicago, have filed for bankruptcy protection. But he said the bigger builders have managed to hang in so far by selling off land and inventory at reduced prices.
However, the stock market has punished the shares of those bigger builders, and prices of many continued to fall yesterday.
Local and national builders in the Washington area acknowledged the trying times. Some say they are faring better than others.
John Monacci, vice president of operations for Winchester Homes in Bethesda, said traffic through his company's model homes is up 20 percent this year.
"But most people have a home to sell to move into our home and that's been challenging," he said. "I think it's going to remain challenging. Nobody knows when we're going to come out of the soft market."
Doug Monsein, owner of Douglas Construction Group in Potomac, has had a different experience. He said he builds 10 to 12 custom homes a year in the Bethesda area.
"It's really interesting," he said. "I have never been busier. I believe there's so many wonderful micro pockets that are not reflected or discussed when you talk about the region or national statistics.
"I cannot tell you everyone is saying the same thing," he said. "Many of my builder friends are concerned. Their business is off."
Anthony Paulos, president of Block Builders in Bethesda, who builds custom and speculative homes, said he has built six houses this year.
"As far as the spec homes, the market has been flat for the last year and a half," he said. Speculative homes are houses constructed before a buyer has been lined up.
Two years ago, he said, buyers snapped up the speculative houses before he finished building them. Now, he said, they can sit for months.
"My sense is 2008 is going to be more of the same," he said. "I'm hoping I'm wrong."
