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No. 1 homebuilder Lennar posts larger-than-expected loss.

Lennar (LEN) the No. 1 homebuilder posted loss bigger than expected and sees sharp drop in new orders and deliveries as it cuts staff, plans more layoffs. Shares of Lennar (LEN) lost 7 percent in pre-market trading following the report.

In a further sign of trouble for the battered housing and homebuilding markets, the nation’s No. 1 homebuilder in terms of revenue, Lennar posted a net loss of $513.9 million, or $3.25 per diluted share, down from the net earnings of $206.7 million, or $1.30 per diluted share, in the year-earlier period.

The builder said it delivered 7,636 homes in the period, down 41 percent from a year earlier, while new orders plunged 48 percent to 5,804. It also saw its cancellation rate rise to 32 percent of orders.

“It is already well documented that the housing market has continued to deteriorate throughout our third quarter,” said a statement from CEO Stuart Miller. “Heavy discounting by builders, and now the existing home market as well, has continued to drive pricing downward. Consumer confidence in housing has remained low, while the mortgage market has continued to redefine itself, creating higher cancellation rates.”

The problems in homebuilding are not unique to Lennar. No. 5 KB Home (KBH) is forecast to report a loss Thursday. No. 3 Centex (CTX) reported losses far bigger than Wall Street had expected, while No. 6 Pulte Homes (PHM) have reported losses for the last two quarters and analysts project losses for at least the next year.

Lennar Corp. Home Page
Centex Homes web site
Pulte Homes web site

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