goneil2024 |
01-30-2025 10:39 AM |
IMO TV and specifically the VLS is a well-planned and controlled market with significant capital resources to sustain market, supply and interest rate shifts. As observed, the "lottery" is a way of creating competition between buyers by the seller (developer). Also, as observed by some on this BLOG there are two distinct markets, the MLS and VLS however where the MLS is open and consists of many independent (mostly) sellers while the VLS is not.
As someone who expects to purchase a home in TV, it's clear to me that TV is employing time proven marketing techniques developed by OPEC for oil (a commodity) and others such as the Diamond Market (a luxury product). In the case of the global diamond market prices are influenced by managing the release of rough diamonds to the market through a system called the "single channel" distribution, where only authorized buyers ("sightholders") could purchase diamonds directly from the supplier/cartel, effectively limiting supply and maintaining high prices.
Similarly, in the case of OPEC, the Organization of the Petroleum Exporting Countries, influences global oil prices by collectively managing the supply of oil produced by its member nations, essentially controlling a significant portion of the world's oil production, which allows them to raise prices by cutting production when needed[/I][/B], and lower prices by increasing production when necessary.
In each case (Diamonds and Oil) there is truly no shortage of Oil (just willingness of suppliers) or Diamonds (to release existing supply) in the world, just a limited number of sources that control the supply creating the 'market'. It's all about who controls the market channel and by extension availability of "product" to the ultimate consumer of the product.
In the case of TV and the VLS, my options are limited, even in a buyers' market, so recognizing the market dynamics and what leverage I have is essential. I can control my willingness to make offers on a home(s) in a given village by selecting a model, location, 'New' or 'pre-owned'. Also, as interest rates rise, the number of baby boomers, and retirees' shifts/declines, carry costs increase (tax, material, fees, etc.) I would expect the supply of homes to increase as published in the MLS and VLS. We are seeing and published reports support that the actual sales price of homes offered through MLS are declining as measured by Year-Over-Year (YOY) sales price per square foot (SF) for a given property/type of property or expanding the quality of the offering, e.g., more extras, no bond, furnishing, view, features, etc.,. However, on the VLS being a more disciplined and controlled market as time goes on, we may either see fewer new homes being released as in the case of the lottery, or for those being offered lower offering prices on a SF basis.
In the final analysis I believe homes, love, and diamonds are very personal and emotional choice, TV created a luxury product that blends lifestyle with some features of a commodity, let's not confuse the characteristics of one with the other.
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