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The Big Glut: Trouble in Paradise
Barron's ^ | 5/29/2006 | Robin Goldwyn Blumenthal

Posted on 05/29/2006 11:31:33 AM PDT by ex-Texan

IT WOULD SEEM TO HAVE IT ALL: four bedrooms, a guest house, a pool and a rock waterfall. But the vacation home in Naples, Fla., hasn't been drawing much interest from buyers, so the seller recently threw in that most modern of amenities: the $1 million price cut. That's brought the asking price down a full 25%. "If you want to sell, you've got to go back to '04 prices," says Chip Harris of Coldwell Banker Previews International, which is handling the property.

* * * After a long string of double-digit annual price increases, a number of second-home meccas across the country are suddenly suffering from plunging sales volume and burgeoning inventories of unsold homes. Result: Naples-style discounting is starting to spread. It hit the town of Pocasset, on Massachusetts' Cape Cod, just as retired executive Jack Reen was trying to sell his four-acre, six-bedroom beachfront home. He cut the price several times, for a total of 42% off the listing price, before striking a deal at $3.95 million. Reen takes a philosophical view of the experience, noting that the original price was set at the top of the market. "Calling the tops and bottoms is impossible," he says.

(Excerpt) Read more at online.barrons.com ...


TOPICS: Business/Economy; Culture/Society; Editorial; Government; US: Florida
KEYWORDS: bubbles; housing; iluvwilliegreen; mynameisdoom; pimpingmyblog; realestate; skyfallssomemore; wrongsince2003; zotmeplease
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'Nuff said. Unless you want to hit Google

1 posted on 05/29/2006 11:31:34 AM PDT by ex-Texan
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To: ex-Texan

'


2 posted on 05/29/2006 11:38:24 AM PDT by BikerGold (Reliously Uncoooorrrrect...Reliously UUUUUUncorrect)
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Comment #3 Removed by Moderator

To: ex-Texan

Purchased 2 waterfront condos in SW FL, no complaints here. They still can be sold for 3x the original cost. The housing market here will come back up shortly. Once the Boomers start retiring in larger numbers.


4 posted on 05/29/2006 11:39:53 AM PDT by Bringbackthedraft
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To: ex-Texan

I'd say that I feel sorry for the sellers, but I'd be lying. I guess there's a little bit of the class-warrior lurking in the dusty corners of my psyche.


5 posted on 05/29/2006 11:40:20 AM PDT by Tax-chick (Let all creation sing of salvation. Let us together give praise forever!)
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To: ex-Texan

2 great anecdotal stories...what's missing ?
what they originally paid for the homes.....


6 posted on 05/29/2006 1:34:57 PM PDT by stylin19a (There are 10 kinds of people in the world, those who understand binary and those who don't)
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To: ex-Texan

Ritz Carlton in Naples, one of my favorite hotels...note related to post, but had to be said.


7 posted on 05/29/2006 1:37:17 PM PDT by durasell (!)
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To: Tax-chick
Hate the game

don't be hating the players.....

I sold my waterfront Florida property and moved to Texas.... Went up 400% in 7 years.... sweet!!

The area where I moved to is about 70% less in cost of living and best of all....in Texas. 'nuff said. I only wish I could live through another boom like that.

8 posted on 05/29/2006 1:43:26 PM PDT by Dick Vomer (liberals suck......... but it depends on what your definition of the word "suck" is.)
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To: BikerGold

Re your tagline, is "reliously" a word you invented?


9 posted on 05/29/2006 2:08:20 PM PDT by Tax-chick (Let all creation sing of salvation. Let us together give praise forever!)
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To: Dick Vomer

I don't hate them ... I just think there's some cosmic justice working :-). Like I said, it's my bad streak!


10 posted on 05/29/2006 2:09:17 PM PDT by Tax-chick (Let all creation sing of salvation. Let us together give praise forever!)
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To: Dick Vomer

400% great for the tax collector.


11 posted on 05/29/2006 2:13:27 PM PDT by OKIEDOC (There's nothing like hearing someone say thank you for your help.)
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To: Benjamin Rodriguez

"without the expanded lending especially the refi's we would be in a depression."

Bring it on, the quicker the better. The longer it's held off the longer and deeper it will be.



12 posted on 05/29/2006 2:19:09 PM PDT by dalereed
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To: Tax-chick

Congrats! First in 2 mos. to noticr that :-)


13 posted on 05/29/2006 2:29:13 PM PDT by BikerGold (Reliously Uncoooorrrrect...Reliously UUUUUUncorrect)
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To: ex-Texan

My girlfriend had a contract put on her crappy 3 bedroom cloned home in a exurb development an hour outside of Washington DC for $499,000.... in one hour. She turned around and wrote a contract to buy a house listed at 550,000. It may be that above a certain price point, you willonce again find fewer buyers....but it seems that the median price point is still pretty high, and there are still not enough houses available.


14 posted on 05/29/2006 2:42:52 PM PDT by Katya (Homo Nosce Te Ipsum)
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To: BikerGold

I'm a good noticr.


15 posted on 05/29/2006 3:47:09 PM PDT by Tax-chick (Let all creation sing of salvation. Let us together give praise forever!)
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To: Tax-chick

LOL! Hey, give me a break cuz BikerGold is a disfigured/disabled vet and today's my day =-)


16 posted on 05/29/2006 3:57:35 PM PDT by BikerGold (Reliously Uncoooorrrrect...Reliously UUUUUUncorrect)
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To: durasell; stylin19a; Benjamin Rodriguez; Tax-chick; BikerGold

The point catching my attention is that luxury homes in vacation zones are now selling at 2004 prices. The author may be prescient. Soon prices all over the U.S. may be falling back two years. Mr. Rodriguez may have hit the nail on the head. How many luxury automobiles were financed using exotic mortgages?


17 posted on 05/29/2006 4:26:42 PM PDT by ex-Texan (Matthew 7:1 through 6)
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To: BikerGold

Thank you for your service! Typso are a hobby of the North Carolina FR community ... it's all in fun.


18 posted on 05/29/2006 4:37:07 PM PDT by Tax-chick (Let all creation sing of salvation. Let us together give praise forever!)
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To: ex-Texan; abcraghead; aimhigh; Archie Bunker on steroids; bicycle thug; blackie; coffeebreak; ...

Oregon Ping

Please notify me via FReepmail if you would like to be added to or taken off the Oregon Ping List.

19 posted on 05/29/2006 5:19:39 PM PDT by Salvation (†With God all things are possible.†)
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To: BikerGold

Bend, Oregon is listed as overvalued. The author is showing his ignorance. Bend will keep stay steady for a long time, if not continue going up.


20 posted on 05/29/2006 7:31:02 PM PDT by aimhigh
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