Lennar Corp., the largest U.S. homebuilder, reported a loss for the fiscal second quarter as the housing slowdown discouraged buyers and prompted price reductions.
The net loss amounted to $244.2 million, or $1.55 a share, in the three months ended May 31, compared with a profit of $324.7 million, or $2, a year earlier, Miami-based Lennar said today in a statement. Revenue tumbled to $2.88 billion from $4.58 billion.
Rising defaults among subprime borrowers and mortgage rates near an 11-month high are hampering sales for homebuilders even as they cut prices. The slump in housing has moved into its second year as prospective buyers hold off purchasing in anticipation prices will continue to fall.
``As we look to our third quarter and the remainder of 2007, we continue to see weak, and perhaps deteriorating, market conditions,'' Chief Executive Officer Stuart Miller said in the statement. ``We currently expect to be in a loss position in our third quarter.''
Not much to add to this, is there? The housing market is clearly in a recession at this point. And with a massive inventory build-up, rising interest rates and tightening credit standards, the decline will continue for some time.
