This from Real Trends: "As sales slow and inventories jump, large publicly traded home builders are trimming landholdings or renegotiating deals, according to earnings reports and industry officials. The development illustrates the fact that some previous land deals done at the height of the housing boom no longer make business sense. It also reflects the fact that builders see the slower market as giving them leverage to force sellers to cut prices.
‘Land sellers are at a disadvantage right now, and some, because of the way they’re financed, can’t really hold on and wait for the market to normalize,’ says Mackey O’Donnell, founder and CEO of O’Donnell/Atkins, the largest land-acquisition firm in California.
Builders tell O’Donnell they are seeing up to 10 to 20 percent reductions in land prices from recent highs. As large builders reduce their holdings, some smaller public and private builders are moving in, he says. Smaller firms have had trouble competing against larger builders."
