Misrepresented?

**cpborrelli** · 09-24-2008, 06:41 AM

December will be 2 years I purchased a house from Mercedes Homes. A Builder in FL. I paid 197k for a 3 Br 2 Bath new leftover home. At the time the builder assured us that prices were going up later that year. Since that time they have done nothing but go down. The builder never rose prices and of course our house is worth about half what we paid for it.
Are they allowed to misrepresent like that?

Thanks Chuck

**minnesota-mls** · 09-24-2008, 10:02 AM

Unfortunately, as we know, real estate across the entire country has seen pretty significant price drops. For example, I personally purchased a number of rental homes for sale up here in Minneapolis the last 6-7 years. All of the homes are rented, however, I surely have lost a good chunk of equity simply because of the market. Had I known in advance that I was buying at the high end of the market, I surely would not have purchased as many properties as I did.

However, here in Minnesota for example, the real estate market has slowly but steadily appreciated over time. I have faith that prices will rise again. Time will heal the wounds of these price drops we have seen around the country.

**jamesww** · 09-25-2008, 06:39 AM

They are allowed to make statements about their intentions for the near future and so if they told you that they intended to raise prices later in the year they may have actually expected to do such. Especially if your purchase was prior to August 2007.

In August of 2007 the entire credit market changed as Hedge Funds prior to that point became a major provider of credit to the housing market. Then in August sub prime lending troubles sparked a forced sell off of mortgage backed securities by the Hedge Funds. That swamped the market and ignited fears that is when we started to see very tight home lending and thereby declining home prices.

I hate to say it but the fact that the builder could not have predicted the events of August 2007 they are off the hook when it comes to misleading you.

**Mike Taylor** · 09-26-2008, 03:49 AM

I think you just bought at the wrong place at the wrong time. At that time, everyone thought the sky was the limit with housing prices.

**mWoods** · 12-11-2009, 07:56 AM

This is tough situation to be in. I truly want to believe that builders are honest and meant what they told you 2 years ago. They could not have predicted current market conditions any better than you or I.

**caseyzeman** · 12-11-2009, 03:39 PM

This is another one of those problems when you go with new construction. The developers are trying to keep themselves a float. Unfortunately at your expense. Of course you did nothing wrong but because of the economic problems today this is what occurred.