Homebuilders See Higher Cancellation Rates
A few homebuilders have reported first quarter 2006 results already and a number of them have reported that they are seeing higher cancellation rates than normal. Put simply, more people are walking away from commitments to buy new houses than in the past.
Looking at the earnings schedule, Toll Brothers plans to report give an update for its second fiscal quarter on May 5th. This should be an interesting conference call since the CEO, Bob Toll has been pretty insistent that the market is still in good condition.
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"We are keenly aware that the homebuilding environment has weakened," said CEO and Chairman Larry Mizel in a statement. "Because the level of our success in 2006 will hinge largely on our ability to generate net home orders in this environment over the balance of the year, we are not in a position to predict whether our revenues and earnings for the full year 2006 will exceed our 2005 performance."
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[Ryland said new orders in the first quarter fell 21 percent from a year earlier, to 4,021. The value of the new orders fell nearly 17 percent, to $1.18 billion.
"People are unable to sell their existing homes for what they thought they might, and are unable to go through with their anticipated purchase of their new home," said Raymond James and Associates analyst Rick Murray. "So, they end up canceling their contract."]
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Looking at the earnings schedule, Toll Brothers plans to report give an update for its second fiscal quarter on May 5th. This should be an interesting conference call since the CEO, Bob Toll has been pretty insistent that the market is still in good condition.
Snip
"We are keenly aware that the homebuilding environment has weakened," said CEO and Chairman Larry Mizel in a statement. "Because the level of our success in 2006 will hinge largely on our ability to generate net home orders in this environment over the balance of the year, we are not in a position to predict whether our revenues and earnings for the full year 2006 will exceed our 2005 performance."
More
Snip
[Ryland said new orders in the first quarter fell 21 percent from a year earlier, to 4,021. The value of the new orders fell nearly 17 percent, to $1.18 billion.
"People are unable to sell their existing homes for what they thought they might, and are unable to go through with their anticipated purchase of their new home," said Raymond James and Associates analyst Rick Murray. "So, they end up canceling their contract."]
More
posted by Little_Silvered at 5:44 PM
1 Comments:
Do you have numbers for NJ? That is, is there an increase of cancellations in NJ also?
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