ORLANDO—“In the old days …” Ted Crocker says, wistfully aware that he's conjuring up an era less than 12 months past. A year ago has a sweet ache reserved for bygone events. Those halcyon days differ so dramatically from this day, Oct. 2, 2006.
“In the old days,” the controller for the Orlando-based Park Square Homes continues, “everybody wanted to close.” Buyers planned and dreamed a new life in a new home—where they would talk about where to put the Christmas tree and which wall to hang the family photos on.
“It is very different now, and it changed immediately,” Crocker snaps out of his reminiscence. “We are finding that 50 to 60 percent of our buyers aren't showing up to closing. … That emotional tie is not there.”
12:00 P. M. At Timpano Italian Chophouse near Universal Orlando, Crocker holds court over lunch at a long table with top executives of Orlando's fifth-ranked home builder. The men dip hot crusty bread in olive oil and vinegar as they talk about how the company tries to cope with the reluctant buyers of today. More than one diner looked longingly at the full page of martini offerings. Iced tea all around.
Inexperienced, impatient investment buyers are usual suspects among the no-shows on closing day, they lament. A glut of homes for sale in the Orlando market isn't helping. The number on the local MLS mushroomed from a low of about 3,000 in May 2005 to about 20,000 by fall 2006.
Excuses for going MIA before closing could make a Letterman Top 10 list. Relatives with ties to financial entities write letters saying a buyer isn't credit worthy. Others “lose” their jobs, get divorced, fall sick. One guy is said to have faked a heart attack. Another stalled on closing because his mother died, and then because a co-worker died. When the same fellow wanted to postpone because his dog died, Park Square pulled the plug.
Eliminating the excuse of not having the means to close by making sure buyers are pre-qualified has become a strong focus. “Before, there was never any real focus on the quality of the buyer,” says Bagley. We don't want another spec. We need to make sure the backlog is pure and clean.”
Managing the company's less than pristine backlog has become Crocker's full-time preoccupation. The task also absorbs the company's closing coordinators, whose jobs went from being a cinch to complicated beyond belief. “A year ago they were all glorified maitre d's, because everyone wanted to close,” says Crocker.
Executives eat and tell war stories. It's laugh-so-you-don't cry humor, a sign of the stressful times.
Learn more about markets featured in this article: Orlando, FL.