The Dallas News reports on builder incentives in that city. "Sale. Price reduction. Limited-time savings. If it works for Wal-Mart, why not Centex Homes or Grand Homes? That's what builders are hoping. Coming out of the winter slow season for home sales and with inventories edging up, some builders are spreading the word that they want to wheel and deal."

"The supply of unsold new homes in the Dallas-Fort Worth area was up more than 10 percent at the start of 2006. There were about 8,751 completed, unsold new homes on the market at the end of December. While that's a small number historically, it's still more than double the unsold home inventory at the end of 2000."

"The deals sound too good to pass up, and that's what builders are hoping. Grand Homes is advertising new homes in Lancaster 'reduced $30,000.' In Allen and McKinney, they are cutting prices by $15,000 and $25,000 on some models. Mercedes Homes says it will give up to $14,000 in free options for buyers of its houses. American Legend Homes is offering '$10,000 savings' at one of its McKinney subdivisions. And Centex is cutting prices up to $15,000 on some of its models."

"'I know Centex is hitting it pretty hard, their [fiscal] year end is March 31, so that might be part of what you are seeing,' said housing analyst Ted Wilson. 'There is a fair amount of speculative construction in the market right now, so I imagine the incentives will stay with us at the higher level through the summer.'"

"Builders had better be careful with the giveaways. Apartment landlords have offered so many freebies to attract renters in the last few years that they can't get their prices up even though the market has tightened. And although it's possible for builders to finagle their pricing to give homebuyers the lure of markdowns, it will be more painful for sellers in the pre-owned home market to play the price reduction game."