Demand three years ago is not demand

A market can be loud and late at the same time.

Three years ago the demand in a submarket was screaming. Everyone heard it. Everyone bought.

The homes those decisions produced are finished now, and some of them are still standing empty.

That is not a story about bad operators. It is the lag. Land takes years to answer a question the market asked when the land was still cheap.

So before I believe a number, I read the curve instead of the peak.

Growth

Is the curve still rising, or did it already flatten?

Absorption

How many homes a month are actually closing?

Inventory

What is standing unsold right now?

Incentives

What are builders giving away to move product?

Pipeline

What is already entitled and not yet built?

Buyer

Who exactly is buying at this price, today?

When the answers go the wrong way, leaving is not the only honest move. Sometimes the answer is to change what you are making: finished lots instead of houses, a narrower lot, a different price band.

I would rather buy the demand that exists than the demand that was.