"inventory glut"

So the Bend City Council has decided to make it easier for builders to pay their SDC. Good idea. Build more homes, quick! I shudder to think what our council is going to look like when it is filled with members who aren't just one or two degrees removed from the building community, but active real estaters. That ought to work out well.

Meanwhile, over on the business section is this wonderful little article about Pennbrook, who apparently is defaulting on a gimmick of leasing back houses it sold. No good gimmick goes unpunished.

What I love is the detached air of the comments by Bauhofer, as though it has nothing to do with him: " We had a lease-back program on our project out at Eagle Crest," said Pennbrook founder Don Bauhofer. "With the downturn in the market, the company just ran out of money."

(Later in the article -- "...other Pennbrook companies, including Arrowood Development remain active." Wish I could do that -- sorry, I'm not paying the bills on that part of the store, but you can still buy from me in this part of the store.)

Here's a final comment that ought to be plastered on the foreheads of our city councilors for a day or two while they walk around, (INVENTORY GLUT). If they can manage that without embarrassment, then I give them their little gimmick. (Remember, no gimmick goes unpunished.)

"...when financing became more difficult and a lot of those buyers had to pull out of the market, and that precipitated an inventory glut," Bauhofer said. "The builders were left with a substantial number of units that had been built on presale."

Bauhofer says, "...he and other investers never expected the market's bottom to fall out. "It's a really unfortunate product of the market. You don't make an investment believing the value is going to go down.""

And apparently, if you make a legal commitment to pay the lease because of a gimmick and the house turns upside down, you walk away and let the courts thrash it out. How reassuring.