Quote:
Originally Posted by Goldwingnut
The bonds are not loan, they are investment vehicles,
The bond isn't an additional profit center for the developer, you are going to pay for the costs of the infrastructure either in a bond or rolled into the total cost of the home. For the developer the bond is helpful as it recovers the costs quicker than having to wait several years to sell out the entire community.
.
|
Thank you for your input, Don.
As is obvious from the original post and your post, CDD Bonds are an extremely complicated subject and until you've had personal involvement in the (wing) nuts & bolts, it's hard to appreciate how it all works. I disagree that they're not a "loan", but that's simply semantics.
I think the most informative part of your post for those who don't understand the concept, is the sentence above in italics. Buyers have to pay for the infrastructure, one way or the other. If this wasn't a CDD Community, every home would have initially been priced at least 10% higher, to recoup the Developer's infrastructure costs.
You're far more of an expert than I on CDD Bonds, but if you jump into this again, you might want to remind folks that the Interest Rate spread is regulated by the state and not just a number the Developer picks out of the sky.
How are CDD Bonds going to be affected by the current interest rate situation? Interest rates this high, are something we haven't seen in many years. Bond prices move inversely to interest rates, as you know. How will this effect the Developer's plans to the South and resultant bond prices?