D.R. Horton Posts 37% Drop In Home Orders
D.R. Horton Inc., the nation's largest home builder by number of units, said its second-quarter orders fell 37%, an indication that the crucial spring home-selling season is proving to be weaker than many builders had hoped.</br></br>The company said it had orders for 9,983 homes in the quarter ended March 31, compared with 15,771 homes a year earlier. The dollar value of those orders was $2.6 billion, down from $4.4 billion a year earlier.</br></br>"Market conditions for new-home sales continue to be challenging in most of our markets as inventory levels of both new and existing homes remain high," Chairman Donald Horton said. "Our cancellation rate is essentially unchanged from the prior quarter, but it remains above our historical range as we continue to see an increase in the use of sales incentives in many of our markets."</br></br>Orders in all geographic regions declined in the fiscal second quarter. California posted the sharpest drop, declining 59% to 1,107 homes. Orders in the Southeast fell 30%, in the South Central region orders dropped 34% and in the Southwest slid 39%. The West was down 28%. The Northeast had the smallest decline, down 21%.</br></br>Horton, based in Fort Worth, Texas, is the latest builder to report that the usually strong spring-selling season has gotten off to a slow start. Its deteriorating orders come amid a tightening of mortgage- lending standards and a softening of home prices in many markets.