Lennar Corp, the third-biggest homebuilder in the United States, reported a higher-than-expected quarterly profit and a decline in orders that was less severe than Wall Street had feared. Lennar's orders fell sharply following the expiration of a U.S. tax credit that boosted home sales last spring. But the Lennar order decline was not as grim as the decline for the rest of the industry.
Orders fell 15 percent to 2,624 homes due to the April 30 expiration of the tax credit, which induced homebuyers to accelerate their purchases. Nationally, however, new home sales fell in the mid-20 percent. The decline was exacerbated by unemployment and associated foreclosures that present a cheap alternative to new home purchases, the company said in a statement.
Lennar owed its third-quarter orders to its operations in "the most desirable areas of the most desirable markets," such as the mid-Atlantic region; Raleigh, North Carolina; and parts of California, Chief Executive Stuart Miller told analysts on a conference call. Home prices and demand are stabilizing in those markets, which offer robust job growth and local economies, he said.