Wall Street Journal - 10/13/13 - With home sales starting to slow, builders are giving buyers more incentive to purchase. Some are going so far as to offer tens of thousands of dollars in cash incentives as well as free home upgrades.
The rising cost of new homes-some markets have seen prices soar by double-digit percentages in recent months- and higher morgage costs have impacted buyer demand. Builders are trying to lure them back by agreeing to pay closing costs, part of the downpayment, or offer a discount on a buyer's mortgage for a year or two. Some builders are also tossing in free upgrades, such as appliances, blinds, premium flooring, etc.
Nearly 30% of sales managers at 150 homebuilders nationwide say they increased their use of incentives in September, up from 14% a year ago, according to a monthly survey by Wells Fargo Securities.
Tom: Locally we are not seeing the same concessionary trend from builders, it's actually been the opposite. Builders are selling spec homes before they are finished, and are raising prices every few months. We are also noticing many new building companies popping up in Cape Coral.