In a move that shows builders with cash have an appetite for finished lots in the right place at the right price, Pulte Homes' Del Webb has bought a 480-lot master-planned 55-and-over community in Tucson from K. Hovnanian Homes.

Pulte paid $8 million for the master-planned community of Rancho del Lago. In addition to the 480 lots--276 finished--the sale included 12 model homes, a 14,000-square-foot recreation center, an outdoor pool complex, a 4,500-square-foot sales pavilion, the largest 18-hole putting course in Arizona, and tennis and bocce ball courts.

The buy was an opportunity for Del Webb, which had its roots in Arizona and Florida, to move back into Tucson. Rancho Del Lago is the only active-adult community in the Vail area, which is at the foot of the Rincon Mountains.

"The consumer demand that we receive on an ongoing basis for Del Webb product in Southern Arizona is huge," said Shawn Chlarson, Pulte's Tucson division president.

For now, Pulte plans to continue to sell and build the K. Hovnanian floor plans in place in the community. There are plans to convert to Del Webb designed houses in the future but no date has been set, said Pulte spokesperson Courtney Rice.

Industry analysts say Pulte isn't the only builder on the hunt for prime finished lots at the right price. A June survey of developers by Zelman and Associates said demand for finished lots is actually exceeding closings. It's not a shortage of finished lots available that is slowing sales. It's a scarcity of finished lots priced low enough for builders to bite that is constraining sales, the survey indicated.

While some developers are willing to cave some on lot prices, banks haven't been as willing to capitulate, the survey respondents said.

Still, there's been enough interest for the price of finished lots to begin stabilizing prices in the second quarter of '09 with values down 51% from peak, the Zelman survey showed.

Raw land is another matter. Its worth in many markets is zero.

Research by John Burns Real Estate Consulting also indicates a market for finished lots and a move toward price stabilization.

"Builders in certain markets are actively bidding on finished lots in good locations, driving the prices up," said John Burns vice president Lisa Marquis Jackson. "We are seeing this kind of activity in Southern California and Phoenix."