Moody’s: Homebuilders May Lose $500M in 2010
According to this HousingWire article, Homebuilders May Lose $500m in 2010: Moody’s, US home builders will likely lose a combined $500 million in 2010.
According to the article, "US homebuilders still face risks, despite improvements in home sales and housing starts, and Moody’s Investors Service expects building industry's operating losses to worsen by 8% in 2009. Moody’s vice president and senior credit officer Joe Snider expects homebuilders to continue generating pre-impairment operating losses over the next 12 to 18 months. An increase in foreclosures and weak employment figures will contribute to house prices at their currently low levels, and might cause prices to fall more and for a longer period than currently anticipated."
The article quotes Snider as saying "We expect that the industry’s one relatively bright spot — that is, robust cash-flow generation — will keep fading in the year ahead, as inventory liquidation plays itself out and funds from operations remain negative."
If you live in Middle Tennessee (Rutherford County TN, Williamson County TN, Davidson County TN, Murfreesboro TN, Smyrna TN, La Vergne TN, Eagleville TN, Lascassas TN, Rockvale TN, Christiana TN, Brentwood TN, Franklin TN, Nashville TN and Belle Meade TN) you have probably seen all the new neighborhoods and the advertisements from the builders promoting all the incentives they are offering to buyers. Please understand that if you are buying a new home today you are likely paying too much. Frequently, you can buy a very similar new, or newer, home that is a foreclosure or short sale for less than the cost of construction and less than you can buy it from the builder. You can use my website to search the Middle TN MLS so that you can find a distressed property, a foreclosure or a short sale in Middle Tennessee.
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