It would come as a surprise if Hovnanian Enterprises reports any performance better than a small loss after market close on Wednesday, as it slogs through the bottom of the home building market carrying an extra burden of debt weight and less means to dig out.

Analysts' consensus is that the company will report a loss of $0.52 a share in its third quarter, which ended July 31, with the most optimistic analyst estimating a $0.26 loss and the most pessimistic estimate coming in at -$1.18.

The company has repeatedly said that it hopes to escape the doldrums by loading itself up with lower-priced, ready-to-build land where it can build houses quickly to net higher margins.

Given its high relative debt levels compared to its peers, analysts have questioned if it has the financial strength to compete for the best lots to achieve that goal.

"We remain focused on better understanding of how it can generate improving operating leverage despite existing capital constraints," wrote UBS Investment Research analyst David Goldberg in a note this week.

Anecdotally, builders have reported that the drop-off in home sales since the tax credit expiration has helped dampen some of the competition for lots over the summer, which could give Hovnanian an edge toward that goal.

Despite heavy land-buying competition early this year, last quarter Hovnanian reported it had locked in 7,100 lots in 98 communities in its first two fiscal quarters, despite competition from other builders. It had also been able to reserve cash by optioning 2,900 of those lots and buying another 1,900 with the help of joint ventures. Last November, Hovnanian announced a joint venture agreement with GoldenTree InSite.

CEO Ara Hovnanian has reported that he expects to be getting returns from those lots by next year, boosting margins. While this year, 90% of the company's communities are being marketed in more expensive, legacy land positions, next year the company reported, it expects 40% of its communities will be selling newly re-set lots.

Hovnanian has said that the new land is expected to bring 20%-to-21% internal return rates. It has said it expects to have 200 communities up and running by the end of its fiscal year. On April 30 it had 178 actively selling communities.