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Current state of Real Estate New Construction

lil dickie said: "Here is a lengthy piece about the current state of new [url=http://michaelemilio.com/the-current-state-of-the-real-estate-new-construction-market/]new construction[/url] [quote] Short of cash, several builders have renegotiated with their banks to avoid defaulting on the terms and conditions of their credit lines and loans. Builders are squeezing subcontractors and suppliers for discounts. They’re also redesigning homes to be smaller or with cheaper features. “We are reanalyzing every location we’re in,” said Ara Hovnanian, CEO of Hovnanian Enterprises. Last month, the company sold 2,100 homes in a three-day nationwide “deal of the century” sale with big price reductions. The company has fired 30 percent of its employees, reduced its inventory of home lots by nearly half, renegotiated with subcontractors and re-evaluated option-contracts to buy land. “No. 1, we’re not assuming a quick recovery,” Hovnanian says. “We’re operating as if this is going to continue for a long time.”[/quote] Looks like a classic case of over-optimism when the money was pouring into real esate."

FirefighterB said: "[QUOTE=lil dickie;60161]Here is a lengthy piece about the current state of new [url=http://michaelemilio.com/the-current-state-of-the-real-estate-new-construction-market/]new construction[/url] Looks like a classic case of over-optimism when the money was pouring into real esate.[/QUOTE] It always amazes me that people seem to want to deny the whole "cycle" thing."

lil dickie said: "The companies want to deny it because they love these boom times. Plus...it is probably new management who takes over during the "bust period." Boom and bust periods in US history have always happened in the real estate market so none of the executives of these companies could be that surprised at the boom."

Heather said: "I was reading a while back ago that some homebuilders were giving away all kinds of 'perks' to move new high end homes. Upgraded kitchens w/marble, completed basements and in some cases even paying the mortgage for a couple of months. Seems like some true incentives to try and move these homes off the market.."

sreeja said: "Might be an off-topic...Real estate business is highly booming in India. What is the situation in your area?"