Florida Virtual Houses

Builders offering price guarantees to lure buyers

May 7th, 2008

Builders have been heavily discounting prices hoping to lure buyers back to the market. Prices for brand-new construction in some communities are very tempting and even comparable to bank-owned foreclosures, which sell in “as is” condition.

The problem for builders is that many buyers these days feel that a bargain in real estate is a moving target as prices continue to fall. Some builders, such as Shea Homes and Reno-based Pacific West
Companies, are addressing the issue by offering price guarantees of up to three years, the San Jose Mercury News reported. That means if a developer drops the price for a home like yours before the last home in your subdivision is built, you can collect a refund for the difference.

Residents in the Thornton Grove Estates in Hamilton Township, Ohio might have benefited from such a guarantee. Some Thorton Grove residents recently complained to reporters at WCPO-9 News that new homes in the development are selling for about 20% less than they paid a few years ago.

"To take a $60,000 hit on a house that I bought three-years ago – it just isn't right," resident Kevin Bardsley told the television station.

Entry Filed under: News