Monday, May 01, 2006

Million Dollar Lemons

As told in today's Palm Beach Post, How do you sell a $6.2 million spec house in a chilly market?

"Two months away from putting the finishing touches on a 3240 N. Flagler Drive manse, brothers Richard and Mark Poncy are advertising... a $6.2 million glass of lemonade

Comes with a free home.

The eye-catching ploy may or may not work — Richard Poncy said that as of Friday they had yet to get a nibble — but Poncy, who is brokering the property, isn't worried.

"The market is definitely on the down side," he said, "but this home would be hard to duplicate," given its Intracoastal location and a dearth of similar high-end construction.

Spec homes — shortened from "speculative" and built without a definite buyer — range from the 600 midprice homes Pulte Homes Inc. (NYSE: PHM) had in its inventory as of the most recent fiscal quarter to Addison Development's 2005 sale of a $33.6 million, 34,000-square-foot Palm Beach home.

Are those rarefied high-end deals impervious to fluctuations in the rest of the market?

"We are getting more activity than we have had all winter," said Beverly Knight, who is marketing an $18.9 million oceanfront property just south of Boca Raton.

One possible reason: Some corporate executives get their annual bonuses in the springtime.

Which is why the high price of lemonade may get a little higher when work on the Flagler Drive property's five bathrooms and four baths wraps up.

Says Poncy of the current $6.2 million price tag: "We're actually thinking about raising it."


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