Cancellations of Homes and Condos Driving Homebuilders' Losses
May 4 (EIRNS) - Hovnanian, the 6th largest homebuilder, had far larger losses in the second quarter than expected, due to "exceptionally high cancellations" in the Fort Meyers area of Florida.
Bloomberg reports that such cancellations are becoming rampant across the industry as values decline, and speculators recognize that they will lose less by dumping their down payments.
The Wall Street Journal quotes Hovnanian's CFO, Larry Sorsby, whining that many buyers are suing to get out of their contracts, based on claims that they were misled by Hovnanian or others.
"Ambulance-chaser lawyers" now have adds in Palm Beach: "Your contract for the purchase of a new house or condo may be illegal -- To see if you are entitled to a refund, call today...."