Builders Drop Prices, Clear Out Inventory for Michigan Mortgage Seekers
By discounting prices on new houses by as much as $70,000, a group of area home builders hopes its deals are just too good to pass up despite the current sales slump.
Thirteen houses from several area builders are featured in the first “New Home Inventory Clearance Sale” taking place this weekend and next. The event is sponsored by the Builders Association of Metro Flint in the Michigan housing market.
The sale, featuring discounts as high as 21 percent, is prompted by the area’s slowdown of new house sales and builders’ desire to reduce the inventory of Michigan homes. Builders have dramatically slowed the number of new houses they are building, while now some are lowering the prices drastically on houses already built.
Many of the houses in the sale are models and have special features and upgrades.
“I’m not going to stand here and lie and say, ‘The housing industry is strong.’ It’s not. It’s weak,” said Barry Simon, president of the Builders Association of Metro Flint. “But that’s to [Michigan mortgage applicants’] advantage right now. The story is there are some great opportunities in the housing market today, and people ought to take advantage while it’s still there.”
Earlier this month, The Flint Journal reported that new housing starts in Genesee County collapsed in 2006, sinking to the lowest level in 14 years. Also, the average home price dropped 16 percent compared to the previous year.
However, the decline in house sales isn’t just in Genesee County and southeast Michigan.
A U.S. Commerce Department report showed new house sales nationally fell last month by the biggest percentage in 13 years. Across the country, demand for home mortgages has slowed.
Davison Township-based Lexington Properties has a home in Davison Township for sale for $239,900, down from $270,500. The company also has four others available at discounted prices, said Ted Macksey, managing partner for Lexington and president of the builders association.
Locally, Macksey builds 30 houses in a given year in Davison, Grand Blanc and Richfield township areas. Last year, he sold about 12. He has sold three so far this year and has a goal of selling 12-15, as he prepared for fewer home loans to be applied for in the region.
He said the sale prices aren’t a gimmick and aren’t going to be around long.
“This isn’t like a furniture store that has a sale every week or every month,” Macksey said. “This is a true blue, incredible deal.”
SOURCE: The Flint Journal