Housing Market Tracker - Homebuilder Review

 |  Includes: BAC, CAA, CTX, DHI, DHOM, LEV, TOL
by: Judy Weil

Here's our summary of articles and data points on the housing market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day

"This looks like it's going to be the deepest correction of any housing correction since World War II, and the question really is, `What's the duration, how long will it be?''' - Centex CEO Timothy Eller said at a JPMorgan Chase & Co. conference in Las Vegas on Nov. 27. (Bloomberg, Nov. 30th)

Homebuilders, Housing Stocks and Housing-Related Stocks

  • Housing Slump's Third Year to Be 'Deepest' Since WWII (Bloomberg, Nov. 30th): "S&P's 15-member Supercomposite Homebuilding Index tumbled 62% this year as of Thursday, the largest drop since the benchmark was started in 1995. The companies have lost about $35 billion of market value. National Association of Realtors in Chicago: The outlook is bleak with new home sales projected to fall 13% in 2008, even as interest rates drop. Losses at Fannie Mae (FNM) and Freddie Mac (FRE), the two biggest U.S. providers of mortgage financing, may restrict the availability of home loans, and CEOs at D.R. Horton Inc. (NYSE:DHI) and Centex Corp. (CTX) expect another tough year."

  • BUYINS.NET: DSL, EDA, DHOM, GPCB, ONEV, TTSP Have Been On BUYINS.NET Naked Short List For 13 Consecutive Trading Days (Trading Markets, Nov. 29th): " BUYINS.NET, www.buyins.net, announced today that these select companies have been on the NASDAQ, AMEX and NYSE naked short threshold list for 13 consecutive trading days: Downey Financial Corp. (NYSE:DSL)... Dominion Homes Inc. (NASDAQ: DHOM) N.A. Dominion Homes was founded in 1952... With 8.52 million shares outstanding and 1.43 million shares declared short as of October 2007, the failure to deliver in shares of DHOM has not been resolved and a buy-in is imminent."

  • Bankruptcy Judge Allows Lenders to Take Back Properties (Builder Online, Nov. 28th): "U.S. Bankruptcy Judge Raymond Ray has allowed KeyBank and Bank of America to take back their properties in what may be another sign that famed builder Levitt and Sons 78-year run is done... Levitt and Sons (LEV) currently owes Bank of America (NYSE:BAC) $103.9 million; KeyBank is owed $96.5M. Tuesday's ruling means both banks can sue to take over the lots (which are mostly in north and central Florida) through foreclosure, which would allow the banks to sell the lots."

  • Affluent Buyers Bolster Toll Brothers' Prospects (Builder Online, Nov. 28th): "Toll's CFO, Joel Rassman: As builders sell off their inventory overhangs, relatively few new homes are going through the approval process. Consequently, the industry could find itself with a shortage of homes "when the customer is less resistant." This shortage will lead to a "flight to quality," especially among affluent buyers that Toll (NYSE:TOL) targets as its primary customer... Toll also has $2.1 billion in available capital it could use for acquisition purposes... Rassman said that his company is already looking at "opportunities" where it might be able to acquire other companies' distressed debt and expand its market share."

  • Toll Bros. Hoping to Get a Jump on Gowanus Rezoning (Brooklyn Brownstoner, Nov. 28th) New York: "One of the biggest would-be developers in Gowanus is still hoping to start construction in advance of the neighborhood’s official rezoning. An executive at Toll Brothers, which is planning to build around 500 units of townhouses, condos and apartments in the area roughly bounded by Bond Street, Carroll Street, 2nd Street and the canal, told us that the firm has “been continuing to meet with the city about how our plan conforms to the framework for rezoning Gowanus, because we’d like to get it certified into ULURP.”

  • Standard Pacific Says No to Chapter 11 (Builder Online, Nov. 28th): "Standard Pacific Corp. (SPF) will not file Chapter 11 bankruptcy protection according to CEO Stephen J. Scarborough: "We have a good record of working with our banks and a plan in place to generate and preserve cash." SPF stock [is] hovering daily near the $2-a-share range... down 90% for the year. Third-quarter earnings posted a $199.7 million dollar loss, and the company's debt load is nearly $2 billion. Despite the swirling rumors, the builder says it is focused on managing its starts, curtailing expenditures, and restricting land development. "We think the worse is behind us," Scarborough noted.

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