Housing Giants - October 24, 2008 - (Page 7)

“as long as you can buy lots for less than replacement cost that’s probably the way to go.” — Charles Sheron never recover their value. But if you are willing to take that gamble, in the next year or so, you can pick up some really deeply discounted lots that may pay dividends a couple of years later.” Sheron said you may think you don’t need to develop land for the next 10 years, but predicting market conditions beyond the next two or three is a dicey thing. Sheron took the gamble on distant lots in the Atlanta market in past recessions based on his assessment that “eventually, they will all come back into play, and builders will need to develop land again.” But he wasn’t dealing with $4 a gallon gasoline prices then. “The other thing I’m concerned about now,” he says, “is how municipalities will look at land that is entitled now but undeveloped or in various stages of development. How long will they wait for a builder to use that land before pulling the entitlements? “It’s really hard to address this subject generically,” Sheron cautions. “It’s so local. But in Atlanta, it appears some of the public builders are already flipping over from land sellers to acquisition mode. They’re buying!” The best policy for strategic planning: Never say never. If you’ve had to develop land in your market in the past, you probably will need to do so again. And remember, it can take years to entitle and develop raw ground. HG conference Presentations online now Missed the conference? Check out the Professional Builder Benchmark and AVID Leadership Conference site to download copies of the presentations. www.Housinggiants.com 10.24.08.Housing giants http://www.housingzone.com/probuilder/info/CA6369493.html http://www.housinggiants.com http://www.www.Housingg http://www.www.Housingg http://www.iants.com http://www.iants.com

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Housing Giants - October 24, 2008

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