Most of the earnings reports for the big homebuilders will be in the last week of July. This warning seems to have been some kind of a bear trap -- the homebuilders dropped maybe a percent over the first 45 minutes but have since rallied hard for no reason whatsoever starting in the always-baffling 10:30 timeframe.
"In truth, no one knows how bad the housing market will get. It has been in a multi-decade Federal Reserve inspired boom. Now that the Fed is raising interest rates, the key question will be how much damage have the rate hikes to date already done to the real estate market. Remember, it may take months before all the problems show up. And once they do, we don't believe the Fed will reverse and lower rates until a major obvious crisis hits the economy and/or financial markets. By that time, the real estate market could be on life support."
California is beginning to plummet. Kennedy-Wilson Real Estate Auctioneers in Santa Monica, Ca. is gearing up for a good run.
Well, if my home is any indication, KB will continue to see declining sales and cancellations. I don't think it's representative of the market as a whole, they (KB) build CRAP!!!
I am the second owner of my home and the things that I've found and seen in mine and my neighbors' homes just amaze me. Such shoddy workmanship and shortcuts that I kick myself for not looking a bit closer at what I was buying. I'll fix it, learn from it and move on.
I will never look at a KB (KaufmanBroad) home again.
Cheers,
SZ
"Our outlook is tempered with caution, however, as conditions in many of the markets we serve across the United States have become more challenging in recent months. A number of our markets have been affected by a build-up of new and resale home inventories, higher interest rates and higher cancellation rates, particularly markets that have experienced rapid price appreciation or substantial investor activity, or both, in the past few years. As a result, our sales have been adversely affected. During the quarter ended May 31, 2006, for example, we generated 9,908 net orders, a decrease of 19% from the 12,290 net orders posted in the same quarter last year. Second quarter 2006 net orders from our French operations increased 16% on a year-over-year basis, while our U.S. net orders decreased 27% during the same period."Source: KBHomes SEC form 10-Q
While the article seems to present the obvious, how good of an authority is the author? Just curious if you know this guy's background.
If there has been a flatlining or correction in the real estate markets, it hasn't hit Seattle where median home prices continue to skyrocket.
S&P Changes Outlook On Toll Bros To Stable
2:29 (Dow Jones) S&P affirms its triple-B-minus ratings for Toll Brothers (TOL) but revises its outlook to stable from positive. It also affirms ratings on about $1.1B of senior unsecured notes issued by Toll Brothers Finance and $350M of senior subordinated notes issued by Toll Corp. "The outlook revision is due to negative new order trends that have been deeper and broader than anticipated during the early stages of the overall housing market correction, precluding an upgrade in the near term," says S&P credit analyst James Fielding. (MCN)