Lennar Finding Florida Market Not So Sunny

Lennar spokesman Marshall Ames wasn't aware of the move to drop the restrictions at certain properties. "We have long had a policy for discouraging speculators," he says, explaining that it is not a uniform policy but rather a market-by-market decision by the company.

Public homebuilders began enacting anti-flipping clauses for several reasons. One was the public relations factor, with builders saying they would rather have buyers inhabit their homes rather than immediately hang for-sale or for-rent signs across the community. Builders also don't want to compete with the resale market when selling their own homes. Many flippers are selling homes in communities where builders haven't finished selling their own stock.

Calls to Lennar sales offices in Miami and Orlando confirmed that one-year anti-flipping clauses are still in place for properties there.

"You don't want the investors because they ruin your market. The investors are driving pricing unrealistically, we believe," says Ray Gilbert, a sales consultant at North Shore at Lake Hart-Mallard Landing, a Lennar property in Orlando. Gilbert says the anti-flipper policies for Lennar's Orlando properties were enacted a year ago and require that owners selling a home within a year pay 50% of the profits to Lennar. In Miami, like the former Palm Beach policy, if you sell your home within a year, you pay 10% of your resale price back to Lennar. It's not clear when the Miami policy was enacted.

In the Palm Beach market, Lennar was one of the last of the builders to enact anti-flipping policies, according to Morgan, the local broker. But the policy ended up being a bust for sales, he says.

Centex Homes (CTX Quote), which is also very active in the Palm Beach market, has kept its strict investor policy in place. If you buy a Centex home and sell it within a year, Centex keeps all of the profits, according to the company's local sales office.