On December 3, Catherine Reagor reported for the Arizona Republic, Now May be the Time to Buy. Our thanks to L for giving us his take on Ms. Reagor’s article [L’s added comments are in blue]:
As many as 40 percent of the contracts on all the new homes in the Valley during 2005 and early this year have fallen through. That translates to 25,000 spec homes, according to a new survey from housing analyst RL Brown.
Brown must have found more under a rug, because a couple of weeks ago all he could find was about 5 to 6 thousand specs. He seems to imply builders have stopped building. Wrong!! Homebuilders are building more than they’re selling!! In addition, just because the builders haven’t pulled permits doesn’t mean they aren’t going to. They have the land. The land is being readied. They have the employees. What do builders do? They build. They can’t stop and send all their staff on a one-year sabbatical. They will have to build homes. The land and the overhead is costing them money, so they have to build homes.
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