Prescott Arizona Area Foreclosure News

Short Sale: $149,999 New: $214,990

The Wall Street Journal today had an article today on the impact of short sales and foreclosures on new home builders and their lack of ability to compete and sell new homes.

We’ve seen this phenomenom in Prescott Valley’s Granville and Pronghorn Ranch sudivisions where new home building has ground to a halt.  Newer homes, many bought buy investors, in these neighborhoods are being foreclosed on and folks are choosing the 20% discounts over new homes being offered by builders.

Search for REOs in Prescott Valley

Analysts are asking if builders can lower their prices even more before building a house costs more than they can charge for it.  In some markets in Arizona and California, builders have reached that point already and have stopped building until the foreclosure glut is cleared.

As inventories of REO homes has grown, new home builders across the country are competing against foreclosed and short sale properties for sales. Steve Ruffner, president of the SoCal division of KB Home, told the Wall Street Journal in the article, “We are no longer competing with other builders. We are competing with foreclosures.”

See the whole article here: Foreclosed Houses Haunt Home Builders

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