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Originally Posted by chuckinca
The developer made a deal with the agencies that the agencies would accept payment by the buyers at a much later date instead of from the developer up front. I would imagine that the agencies didn't do that out of the kindness of their hearts and probably upped the fees to cover the late payments.
The deal saved the developer the $20 Mil or so that he would have had locked up by the agencies until the last homes were sold (maybe for a period of ten years or so - which means the developer can invest the $20 Mil and turn it into maybe $50 Mil in 10 years or so). Good business. The developer makes out, the agencies make out and the (insert appropriate adjective) buyers are happy to pay the higher costs.
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We all desperately need Community Development District (CDD) training! Simply, the infrastructure (water, sewer, drainage, roads, etc.) is built in advance and financed over a long term through bonds, the payment of which is shared by new land owners, the home buyers. The "builder" just builds and charges for the home and lot.
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Brockton, MA 1946-49 * Fort Lauderdale 1950-66 * Northern Virginia (Army) 1967-69 * North Lauderdale 1970-72 * Coconut Creek 1973-87 * St. Louis 1988-89 # Northern Virginia (again) 1990-2000 * Destin, FL 2001-08 * The Villages - Amelia/Hadley