Villages of Columbus - Columbus Grove - Lantana

NEW -> Contingent Buyer Assistance Program
I stopped by yesterday afternoon. They have five homes left. Three plan 1's and two plan 3's, the plan 2's are all sold out. All of them are being offered with a 75K incentive that can all be used to reduce the price. I forgot to bring in the price sheet, but the range for the plan 1s was from 832K to 855K . The plan 3s were about 80-100K higher. All of the homes that back up onto the canal are sold out, those are the ones that had the higher incentives of 100-120K.





All of the homes are basically done and need just the flooring, although they will be picking that out soon. All of them are available for December move in - they want to close escrow no later than 12/28. There was actually a good amount of traffic while we were there. Im going to go back on Saturday the 15th and make an offer, they are a 12/31 year end so they will really want the houses sold. I figure ill offer them 600K and they can just call me back a week later to accept my offer when (hopefully) their houses dont sell at the current prices.





When i get home tonite I will post the specific lots/plans/prices from the pricing sheet.
 
After seeing what Lennar did today, i don't think they will discount that much to one single person. If anything they would unload the whole lot to an investment bank and be done with it. I still can't believe Lennar dumped 11,000 home to one bank. I wonder what the bank will do with that many new homes.
 
Question: Do builders take such a lowball offers? I mean their price is 850k but you will offer 600k. Are you taking a very small chance or do you know something that tells you it would work? Not disputing your plan but I would very much like to know your plan, tip, secret, or skills to buy brand new house at 30% discount...



I've been looking at Irvine houses for the last 2.5 years. It seems like any descent houses (less than 15 yrs old) in a good neighborhood (westpark, oakcree, turtle X) are not coming down fast enought or low enough to be "affordable". If I can get Lantana plan 2 or 3 for 600k, I'll buy now. I have 20% + down with 760 FICO and 150k salary, but haven't seen any good enough deal to jump in to and even 600k house is a fr"king too much in my opinion...
 
Again, just because "you" cannot afford it does not mean it's not "affordable" for other people.
 
"you" cannot afford a Ferrari, yet there are still plenty of them out there, prices will not drop 50% just for "you"
 
Ocman, his offer won't be accepted. At 600k, not only would YOU be able to afford it, a host of other people would be able to. Supply and demand. Maybe next year, if things really get bad, but not right now.
 
JPMF - it's comments like that which lead me to think that you are the most compassionate of the posters around here.





OCMan - Give it try. The worst that happens is that they say no. Be ready to prove that you can and will close escrow by year end.
 
<em>Question: Do builders take such a lowball offers? I mean their price is 850k but you will offer 600k. Are you taking a very small chance or do you know something that tells you it would work? Not disputing your plan but I would very much like to know your plan, tip, secret, or skills to buy brand new house at 30% discount...





</em>Ok, I have explained this more than once now, but hopefully this time my advice will be used. $600k may be pushing it, but $650 probably could be done. Why? Fiscal year end for Lennar is this month, that's why they need to close by the 28th to put it on their books for the year end. They need to "hit" the numbers, and if they haven't hit them or better yet, haven't gotten close, then the ball is in your court.





Here is what you do... Find out who the sales director is of the division, and remember their name. Not the sales manager, but the sales director. Now, go to the sales office and ask them, "How much standing inventory do you have, and does that inventory need to close by the end of the month?" They will most likely show you what is available, where it is located, and what upgrades are included. Go tour the models, even if you have the unit in mind. When you get back, in a somewhat cocky confidence, tell them you will buy unit X for $605k with a $5k credit to use their lender. SHUT UP... Stare confidently at them like you mean business. Let them spin and BS you. They will most likely say they need to call their sales director. (Almost forgot, make sure it is a Lennar sales rep and not a temp. They get temps on the weekends to help out.) Say, "Fine... call so and so (insert sales director name here). I want to know if this will work, and tell so and so I am serious." They may be able to get a hold of the sales director, but not likely. So, you will leave without a concrete answer.





What you do next, is you call the sales director. Be totally cool and really nice. If it were me, I would google them, and find out if they have ever been in a golf tournament, 5k, etc., and bring it up. Tell so and so you are serious, and you know that they need to get as many units on the books as possible. "I can be one of those units, and I know you can make that happen." Sales directors are ex-salespeople, and they love to have their ego stroked. It is possible that it could happen right then and there, but maybe not. If it doesn't, call the sales director every three days, and stand strong with the same offer. I give you an 80%-90% chance, that this can happen.





The reason why I say use their lender, is they will know that it will get closed on time. Outside lenders have awful pull through ratios, and they know this, and it only adds to your advantage. They could have someone else with a better offer, but they refuse to use their lender, then they will chose you over the outside lender. They would rather eat $25k, than have it not close on time.





I speak from experience, in that I saw this happen more than once, not that I did it myself. I also know of a builder, that sold a home for $580k, when they were selling for $800k. So, yes... I know it can be done. I hope you do take my advice, and I hope it works out. And, you better come back to tell us if it did or not.





JPMF - Just because <em>you </em>can afford the house at the price <em>you </em>paid, doesn't mean that someone else can't pay a lot less to <em>afford </em>the same house.





Disclosure: At the time of writing this, I had no positions in Lennar.
 
Also, Lantana is William Lyon, not Lennar.



I've visited Lantana, and many of the Lennar and WL communities in VOC and william lyon seems to be more stubborn about price cuts. Probably due to the fact they are private and don't care about making numbers "look good" for year end. Cash flow is most important for them. I have no clue how bad things are, but they are not desperate yet. Also, they have too much inventory to cut to 600k right now and kill any chance of making money on the remainder of their lots. I personally think 700K is doable if the homes are still available by year end.



Good advice Graphix, I do think half of the tactics described are unnecessary. I've negotiated three "low ball" deals to an accepted offer with builders so I think I know more than most here. Forget the step about contacting the sales directors. They don't want to deal with you and it's a waste of time for the both of you. They know the market out there and will accept what the market is telling him. They see the flow of offers and know what people are willing to accept. No amount of ego stroking will change that. Just deal with the sales associate at the community. Also remember that once you submit an offer and it's rejected, if there is anyone else behind you waiting to submit, you lose your place.



I purchased from Lennar and closed Nov. 23rd. I made my offer 4 weeks earlier when they had their big "sale" to move inventory before year end in November. I knew I could get aggressive because this was year end and they were desperate to move the ones that were built. I did my homework by looking up homes from previous phases on the tax rolls to see the prices and used that as a proxy to estimate how low they would go. The asking price was already cut 100k for the sale. I then offered another 75K off the price and 100K in incentive. They came back with 75K/75K and said that was it. I countered with 75K/85K and she said no, that was their final offer - take it or leave it. I took it, because 1 of the 4 available had sold the first day of the sale, and the other two were also being bid on by others. The sales director had solid offers on all 4 remaining and knew he didn't have to go any lower for me because there were people waiting behind me to submit offers. Within a week, all 4 were sold, and all 4 closed without any issues. In the end, my net purchase price(including incentives) was 66% of the price of the same floor plan model home that was sold in 06. I think Lennar sold around 50 homes in socal during that sale.



In summary, I think the best deals can be had during the following conditions - year end, home is built and ready to move in, and the homes available are the last ones left in the whole community. This last condition is most important because builders don't need to worry about the new low prices set for future phases.
 
<p>graphix, have you ever negotiated anything before in your life? And do you know what you're talking about?</p>

<p><em>Lennar's year end closed 30Nov. </em></p>

<p><em>Also, Lantana is William Lyon, not Lennar.</em> </p>

<p>LOL</p>

<p> </p>
 
JPMF, I guess you could be one of those who have too much asset tied up in RE, have the primary residence going under water, a totally priced out bitter renter or something. I can't afford Ferrari of $100,000 price tag, but doesn't mean the "affordable" Honda Accord should have a $50,000 price tag at the same time just because Ferrari is priced high. You must admit that homes like Lantana is not "Ferrari" as far as I'm concerned. Lantana shouldn't be priced at 850k and anyone who's buying that is not really thinking clearly financially or has a very moderate idea of dream house. I guess this is a blog where you could be more adventurous and wild since no-one knows who you are but I'm reading these posts for information. I don't need any sarcasm or rude comments. I'm just a hard working guy trying to have that "American Dream" for my family. Next time try to think before you start eagle clawing your keyboard.
 
<p>OCMan, I have no disagreement, but your exact words were "affordable" not "mispriced".</p>

<p>You are just like those subprime lendees, trying to buy something you have no business buying, the only difference is they actually make the effort to go out and buy it whereas you sit at home in your rental and complain about it online. My recommendation to you is do one of the following:





1) Save/make more money until you can afford it.


2) Take out a 100% financing, interest only, ARM and go buy it (this might be hard to do now)


3) Move someplace where you belong like Santa Ana, which is not far from Irvine and still in OC.</p>
 
I think that it is more likely that the houses have no business being priced at the current levels than to say that OCMan has no business trying to buy it. We bought our home in 1998 with the conservative affordability measures were in place to determine how much home you can afford. Within a few years of the extreme appreciation we would not have been able to "afford" our own home if we had used the traditional and conservative methods of determining affordability even though our income had gone up quite a bit.



Does that mean we would have had no business buying our own home in 2005 because appreciation had gone out of control for reasons thoroughly discussed on this blog?
 
RTLGURU-



so which community did you buy in anyways? you got 75k off and 75k in incentives? that is awesome. i am sure the house you bought is expensive probably in the 700k or so?
 
Rtlguru,





We purchased a SFR "starter home" for just under 200K...don't recall the exact mortgage per month back then as we refinanced when the rates dropped. Prop tax was about 2000/year.





In 2005, properties around us were selling for 600K plus. I remember thinking, who is able to afford these starter homes for 600K? That was before I realized that people were taking out suicide loans and they couldn't really "afford" the loan.





I know that some of those people are having trouble with the payments and one foreclosed.
 
<p>Is anyone else having a hard time reading this thread. It looks like all the new comments are getting nested into SCHB's comment. </p>
 
$2k/yr seems low. Does that property tax include mello roos? We also purchased a starter home back in 1999 for just under $300K, but our property tax was in the $6K range. Monthly mortgage was below $2K. These properties are being sold in the 700K this past year, thanks to those suicide loans.





I, too, would like to hear the result of this $600K negotiation. Please keep us posted.
 
Noshellsnail,

Not sure if your comment about 2K/year being low was towards me but no, we don't have Mello Roos. 2K/year was just over 1% of the price of the property. Our prop tax is still under 3K a year and was one of the reasons we were hesitant to move up...we didn't want to pay the increased prop taxes since we were happy with our home.
 
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