Homebuilders slide, but pare losses, after report
NEW YORK (AP) — Shares of homebuilders slid, but then pared losses, Tuesday as a report on pending home sales fueled concern about the strength of the housing sector recovery.
On Tuesday, the National Association of Realtors said the number of buyers who agreed to purchase previously occupied homes dropped 16 percent from October to November — the first decline after nine months of gains.
Analysts had expected a far smaller drop of 2 percent.
The data on pending home sales signals that actual sales will fall this winter.
Americans had been snapping up homes, in part, because of a federal tax credit that was set to expire Nov. 30. In November, the government extended the credit for first-time homebuyers until April 30 and created a credit of up to $6,500 for would-be buyers who have owned their current homes for five years.
Tuesday’s report stokes concern that the recovery will stall as the tax credit is phased out.
Shares of Ryland Group Inc. rose 1 cent to $20.21, after dropping as much as 3.4 percent earlier in the session.
Hovnanian Enterprises Inc. traded down 3 cents to $3.95, recovering from a low of $3.85; KB Home’s shares rose 24 cents to $14.26 after falling nearly 4 percent earlier; Toll Brothers Inc. fell 12 cents to $18.93 after dropping as low as $18.32.
Lennar Corp. was up 24 cents to $13.25 after a 2.2 percent drop immediately after the release, while Pulte Homes Inc. fell 10 cents to $10.14 after falling as low as $10 earlier. DR Horton Inc. rose 6 cents to $11.22, Standard Pacific Corp. gained 8 cents to $3.86, after trading as low as $3.65 earlier in the session, and Beazer Homes USA Inc. rose 9 cents to $5.35, after earlier trading as low as $5.14.