You got to hand it to D.R. Horton's CEO Don Tomnitz. Almost exactly 30 days ago he so eloquently predicted the probable business results of 2007 for America's largest of homebuilders.
Mr. Tomnitz was one of the few business leaders within the real estate industrial complex (REIC) with the cajones to just tell it like it is: 2007 "IS GOING TO SUCK" for America's homebuilders.
Funny quote at the time. But is anybody laughing anymore? I mean, Don was right on.
D.R. Horton's second quarter results ending March 31 have been talleyed. And they sure do SUCK!
D.R. Horton's year on year orders are down 37%.
Net sales orders fell to 9,983 homes from 15,771 a year earlier.
Perhaps worst of all - and very telling in terms of new pressure on home sale prices and the cost of incentives- the dollar value of home orders sank 41 percent to $2.6 billion from $4.4 billion.
Holy crap! For America's largest homebuilder, this is one major sucker punch below the belt! And if this is what's happening to the big boy on the block in terms of building homes and flogging them to the nation, how will the smaller home builders cope?
And the most painful kick in the groin? The state of California - where orders fell 59 percent to 1,107 homes. California was also the market that saw the biggest dip in dollar value of orders, down about 57 percent to $533.5 million.
Unbe-freaking-lievable!
I don' t know.
Maybe it's the quadratic pastel tie that says "I don't give a damn what you think!".
A tip of the hat to you, Mr. Tomnitz. Good call.
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