[missypie]

My former home has also gone up quite a bit since we sold. So for our situation it is still an even keel.

[Dr Winston O Boogie jr]

If the developer or the seller of anything for that matter, with a few exceptions, is gouging people, then people will stop buying from that seller.
The simple little law of supply and demand explains so much.

[peggyb]

We should all be happy about the increases...means our values are climbing

[janieb]

Originally Posted by ilovetv

People will pay a lot to get away from weather like a blizzard in May:

Photos: May winter storm dumps record snow on SE Minn. | Minnesota in Photos | Minnesota Public Radio News

I left the Minneapolis area in August of 2011 but have been back a few times. I was there last April 16th - 22nd, I went to NYC for 4 of those days but there was quite a snow storm on the 18th the day before we left for NY (also the day we closed on our house in The Villages) and then another one on the 23rd when we got back. I left MN to move to MI but now I can't wait until December so I can get out of here and enjoy the warm weather and lovely people of The Villages for the winter.

[2BNTV]

When I was looking to buy in May, a new patio villa was 142K not including the 12K bond and having to furnish it.

Last week, I saw a new patio villa for 179K.

The market have started to rise dramatically on new homes in the span of the last few months. Pre-owned have risen about 10%. If one procastrinates, it will cost even more. IMHO

[justjim]

Originally Posted by 2BNTV

When I was looking to buy in May, a new patio villa was 142K not including the 12K bond and having to furnish it.

Last week, I saw a new patio villa for 179K.

The market have started to rise dramatically on new homes in the span of the last few months. Pre-owned have risen about 10%. If one procastrinates, it will cost even more. IMHO

2BNTV---(142K to 179K) Thats about 26% increase in six month all things being equal. That is a significant increase in a fairly short period of time. Yes, I agree good for current owners and not so good for those planning to buy in the near future.

We are in the so called "Final Phase" for new homes. The Developer of TV is certainly using this as a marketing tool and is raising prices accordingly. Will supply any time soon out distance demand?

The interesting question is will these higher prices be sustained following build-out. I doubt you can find a precedent for what is currently happening here in TV.

[downeaster]

Originally Posted by OBXNana

Gouging is when a hurricane hits and stores raise the price of water to $15.00 per gallon. We need water and have to pay the price. Free enterprise allows anyone to raise the price to whatever someone is willing to pay. As long as people continue to scoop up property at the rate they are in The Villages, the developer has the right to ask what he charges. Do I like it as a person getting ready to buy? Of course not, but it is his right. It is also my right to not buy. But, it's also an investment that can only appreciate in value as the boomers continue to age and we will be making that business decision.

Spot on, OBXNana.

Here is part of Wikipedia's definition:

Price gouging is a pejorative term referring to a situation in which a seller prices goods or commodities at a level much higher than is considered reasonable or fair. This rapid increase in prices occurs after a demand or supply shock: examples include price increases after hurricanes or other natural disasters. In precise, legal usage, it is the name of a crime that applies in some of the United States during civil emergencies. In less precise usage, it can refer either to prices obtained by practices inconsistent with a competitive free market, or to windfall profits.

[Carl in Tampa]

Originally Posted by justjim

A friend of mine closed on his home just six months ago in TV. He "swears" that prices on an exact Designer home like his has gone up in price 30% in the last six months. He says, "The Developer is gouging people".

$250,000 Designer home with a 30% increase would now cost $325,000. My friend is convinced this is true and I have no reason not to believe him as He is not one to make "things" up. I have no valid data to back him up.

Assuming this is correct, is the Developer gouging people on new homes?

You now have four pages of reasoned and rational replies which can be summarized as NO, the Developer is not gouging people on new homes.

[JB in TV]

Originally Posted by 2BNTV

When I was looking to buy in May, a new patio villa was 142K not including the 12K bond and having to furnish it.

Last week, I saw a new patio villa for 179K.

The market have started to rise dramatically on new homes in the span of the last few months. Pre-owned have risen about 10%. If one procastrinates, it will cost even more. IMHO

When we were looking here in Dec 2012, we briefly considered a patio villa, the cheapest ones were about $145,000. IIRC Today, 10/28/2013, this is the cheapest patio Villa:
VNH# 959014
Colony - 2 BED 2 BATH
3*** CARRABELLE CT
Village of Collier
Price: $148,734

With that said, as others have pointed out, it is very hard to compare anything other than a villa, as lots and included features are so varied on all the other home series. With Patio Villas, it is easier to comapre "then and now", as there are somewhat less differences in lots. In Cottages and Designers, lot size, corner, or inside lot, home orientation N W S E etc), how it lines up with the back yard neighbor, cabinet choices, exterior elevation, etc, etc, etc. That doesn't mean that the prices are not going up. Its possible that the developer keeps at least one low priced Patio villa for advertising purposes.

[manaboutown]

Home prices are rebounding in many desirable locations. According to Trulia, from 7/13/13 to 10/13/13 home sales prices increased 14.6% in Newport Beach, CA. Over the last year sales prices increased there 26.8%. Since I currently own a Newport Beach home this makes me quite happy. Yay! Yippee!

The Villages is also a desirable location. Moreover, its target purchaser demographic comprises many baby boomer retirees. Since they are so numerous and relatively affluent, their numbers as well as their desire to relocate to a gentler climate and "free" golf all drive the price of homes here. To further compound and support price appreciation The Villages is additionally desirable for its many amenities, relative personal safety and so on.

[gpirate]

Originally Posted by justjim

A friend of mine closed on his home just six months ago in TV. He "swears" that prices on an exact Designer home like his has gone up in price 30% in the last six months. He says, "The Developer is gouging people".

$250,000 Designer home with a 30% increase would now cost $325,000. My friend is convinced this is true and I have no reason not to believe him as He is not one to make "things" up. I have no valid data to back him up.

Assuming this is correct, is the Developer gouging people on new homes?

Mostly true. I have been following home prices for over a year. Here is my opinion and why.
1. High demand. Used homes have increase as well. Good for sellers.
2. People coming out of the NE & West Coast selling homes for large amounts of money think they are getting a bargain.
3. Offer more things then any 55 and over community I have found.
4. Disadvantages to present home owners: Your taxes will be going up as values continue to increase.

[Bogie Shooter]

Originally Posted by justjim

2BNTV---(142K to 179K) Thats about 26% increase in six month all things being equal. That is a significant increase in a fairly short period of time. Yes, I agree good for current owners and not so good for those planning to buy in the near future.

We are in the so called "Final Phase" for new homes. The Developer of TV is certainly using this as a marketing tool and is raising prices accordingly. Will supply any time soon out distance demand?

The interesting question is will these higher prices be sustained following build-out. I doubt you can find a precedent for what is currently happening here in TV.

I think the precedent is right here in TV. In the period 2001 to 2005. There were dramatic increases in both the new and resale prices.

[justjim]

Originally Posted by Bogie Shooter

I think the precedent is right here in TV. In the period 2001 to 2005. There were dramatic increases in both the new and resale prices.

Prices did increase during the period you describe. We purchased our first home in TV in spring of 2006. At that time, the closing costs included utility hook up and some other costs that normally was paid by the Developer up front and added to the cost of the house.

I remember having "sticker shock" at closing. The Developer changed that policy and added those costs to the up-front cost of the house a few months later.

In a few months the "housing bubble" burst and prices across the county plummeted. TV was not hit near as hard as the rest of the country.

When interest rates go up (and someday they will) could we have another "bubble" in housing? In the meantime, prices continue to climb in TV and as one post indicated----higher taxes for home owners will soon follow.

Gouging may be a bit strong---I prefer to characterize our current dramatic price increases here in TV as "over exuberance" on the part of the Buyers. To those that study history and trends, does this sound familiar?

[graciegirl]

It is the saga of real estate prices, many times repeated in my lifetime.

It is the barometer of the economy.

[Villages Kahuna]

The fact that The Villages is nearing build-out has not escaped the attention of buyers, of both new and pre-owned homes. The state of the financial markets and interest rates is supportive of a buying decision by people who have decided they want go live here and don't want to be "left out". There's a reason why 300-400 new homes are being built and sold each month.

The prices on pre-owned homes have escalated as well. Zillow's estimate of the value of my own home has increased by almost 20% in the last year alone! I'm sure that's an underestimate as Zillow has no way of incorporating the value of premium lots into their estimates. Friends of ours recently sold their well-located and completely professionally furnished courtyard villa in only one day for $48,000 more than their asking price. Three bidders had an intense bidding war until there finally was a winning buyer.

How much of that sales premium was an initial underpricing and his much was buyer exuberance? All I can say is that the initial asking price was well supported by recent comps. Our friends were quite satisfied with the agreed upon asking price and their neighbors thought it was grossly overpriced.

Frankly, I doubt that the developer has increased their target profit margins. They've remained at about 27% for a long time. I do believe that the cost of land and construction materials and labor has increased however. Take a look at the bonds on newer houses compared to those built several years ago. The bond is straight ad valorem split of the cost of utility construction and reflects only the cost of installing utilities, no profit included. We have a Lantana and the bonds on new Lantanas being built in the new southern end of The Villages are more than double our bond on our seven-year old home.

While the developer might have pulled back on any sales discounts or spiffs as now being unnecessary to sell houses, I doubt very much that they are purposely gouging new buyers.