Could Big Homebuilders be Facing Bankruptcy?

1 min read

As residential building starts slow — the annual housing start rate was more than 2 million in 2005; economists expect it to fall to 1 million by mid next year, according to the Associated Press — some large homebuilders, no matter how many bargains they offer, may be in trouble. They’re not going down without […]

As residential building starts slow — the annual housing start rate was more than 2 million in 2005; economists expect it to fall to 1 million by mid next year, according to the Associated Press — some large homebuilders, no matter how many bargains they offer, may be in trouble.

They’re not going down without a fight, mind you. Some, like the 50-year-old Centex Corp. and Pulte Homes Inc., are reducing their operating costs and cutting prices via sales promotions and auctions to sell homes. (Pulte recently trimmed $10,000 to $50,000 off prices at an event and also offered a deal on closing costs and free golf carts in senior communities.)

But when things were booming, some companies may have showed too much enthusiasm. Last Friday, Levitt and Sons, a subsidiary of Florida-based Levitt Corp.
filed for Chapter 11 bankruptcy protection. The reason: "unprecedented
conditions" in Florida and the Southeast, AP reported.

Fifteen or so years ago, a number of builders filed for bankruptcy, including Reston. Va-based
NVR Inc. and U.S. Home Corp. of Houston. Will the same hold true in this slump? Share your thoughts below.

   

You May Also Like

The latest multifamily news, delivered every morning.


Latest Stories

Like what you're reading? Subscribe for free.