Home sales are consistently up at M/I homes, and the Columbus, Ohio-based company came close to breaking even in its third quarter. If it weren't for $15 million of asset impairments and a $4.4 million charge for Chinese drywall, it would have lost $1.2 million.

The company booked a 36% increase in new contracts and increased its backlog by the same percentage in its third quarter compared with the year before. At the same time, it decreased expenses by 19% from the same quarter in 2008.

While those are good signs, CEO Robert Schottenstein was quick to say it's not good enough. "While we are certainly pleased to see our loss narrowing, we are not where we want to be," he told analysts during the company's third-quarter investor call.

Schottenstein said the company's "defensive strategy" is helping, and he credited adjustments to the company's product line and adjustments toward offering more homes targeted for "first-time and value-oriented buyers" for some of the success. Its new "Eco Series," unveiled in its Columbus and Cincinnati, Ohio, markets, has attracted enough interest to persuade M/I to unroll it in other markets.

M/I, like other builders, is also on the hunt for bargain land it can build out for wider margins. It's had some success in the Midwest, particularly in Chicago and the Cincinnati/Northern Kentucky markets where builders have walked away en masse.

"That's presented some opportunities for us," said Schottenstein. "We capitalized on one of them, and we are looking at several others now."

Still, the good deals are somewhat scarce, he said. "There are not a lot of deals out there, and certainly no one should infer these comments to suggest that there are a lot of those out there. They are few and far between."

While M/I would prefer lot option deals, it has found the better deals to be cash sales of lots in bulk. M/I should be in the position to capitalize on those. The company has nearly $103 million in cash on hand, a net debt to capital ratio of 23%, and no debt maturing until 2012.