The Reston, Va.-based home building and mortgage banking company NVR is reporting third-quarter (ending Sept. 30) earnings of $91 million, which is down from $129 million compared to the same quarter last year. NVR, which mostly builds in the Baltimore and Washington markets, wrote off $96.5 million in land during the quarter.
NVR says the quarter was negatively impacted by land impairments, tightening in credit markets, and a weak housing sector. It does not expect conditions to improve in the next quarter.
According to the report, NVR's new-home orders were up 12 percent to 2,660 units, while the builder closed on 10 percent fewer units (3,476) compared with the same quarter last year. The average price of an order declined 9 percent to $330,100. In addition, sales slipped 17 percent to $1.29 billion from $1.53 billion.
The company also reported a 27 percent cancellation rate, which is the same rate as its third quarter in 2006. According to the builder, in the Washington, D.C., region alone, the cancellation rate in the quarter was 44 percent compared to 39 percent in the third quarter of 2006.
NVR says its backlog of homes sold but not settled at quarter-end fell 4 percent to 7,071 units.
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