Homebuilders Agree: January Was A Good Month

by: Judy Weil

As noted on Centex (CTX) Ryland Group (NYSE:RYL) and D.R..Horton’s (NYSE:DHI) earnings calls, January was a good month pretty much across the board for homebuilders. Pulte Homes' results (NYSE:PHM) just confirm the trend. From Pulte Homes’ Q408 conference call:

Now that 2008 is behind us, many have recently asked how the first few days of 2009 are shaping up. While the market is certainly not anywhere close to normal, we are thus far experiencing a modest increase in traffic and sign-up paces as compared to the fourth quarter of 2008. In fact, we've seen traffic and sign-up momentum build weekly thus far into 2009… We have seen an improvement in business beginning this year.

Interestingly, Pulte doesn’t see it as a sign of an upturn:

Appraisers are… appraising the market for what property values are and it's impacting us. We come to the table with an appraised value that might be lower than the agreed-upon sales price and we've got to find a way to get that transaction closed.

If we thought the market was going to get better in the next 30 days, then we'd probably stand our ground. But we haven't seen that and so we continue to be way more flexible at the closing table than what we've historically been.

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