Market Hype and Market Blues

I think it was 2005, when The Devlin Group announced their next development - Ocean Sands condominium in Daytona, an absolutely gorgeous 19-story modern luxury building.

Ocean Villas Condominium was under construction, all units were pre-sold, and prices started from $1 Mil and up. It was a huge success, and the next building was promising to be an even bigger success.

My client wanted to reserve the unit in Ocean Sands, and I showed up at the sales office of the developer, where the party was about to start, and the reservation list was supposed to be filled fast.

I was not invited, but I asked for the agent with whom I worked on a buyer of a unit in Ocean Villas. She came to me and I wanted to give her the check for $15,000 to reserve the unit.

She did not take the check from me. This list was open only to those, who had purchased something from the Devlin Group before. And my client did not buy anything from them yet.

So, I returned the check to my client. He was unwanted in this new development.

Time has brought some changes to the market, and Ocean Sands has never been built. When the market started getting softer, all those reservations started disappearing, and they never got 51% of units pre-sold, so that they could get the financing.

This was not the only condo project where we could not get in with our client’s money, and now we can buy any unit there for half of that initial price.

Of course, only in those projects, which were built. Many of them never made it.

This is called market, and it is even less predictable than Florida weather.

P.S. How many agents were saying that this was the last chance to buy something on the ocean for those prices.

Now, after years in this slow market, did they mean that it was the last chance to pay $1 Mil for what is now $500K?

Shouldn't we all be careful with statements like that?