Beazer Homes: I’ll Take One … Or Not

A fairly remarkable stat from a WSJ story tonight on homebuilder Beazer Homes trying to put recent issues behind it:

Beazer reported that 68% of its prospective home buyers canceled their orders in the company’s fiscal fourth quarter, which ended Sept. 30. The cancellation rate was almost double the 36% of customers who canceled orders and gave up deposits in the prior quarter.

Admittedly, that’s bad, but I have a hard time imagining how it gets much worse. What, does it go to 90%? 100%? Maybe Herb will tell me.

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Comments

  1. Herb Greenberg says:

    Who knows, Paul? Here’s an even more intriguing way to look at it: These home builders have just held all of these great “sales” that brought in buyers looking for bargains. They no doubt put down payments on those orders. How many of THOSE buyers first have to sell their homes? And did the builders agree to buy the homes from them? Time will indeed tell.
    Cheers — and glad to be of service.
    Herb

  2. Andi says:

    Housing market crashes occur in extreme slow motion because only forced sales will reveal the true market prices. These “clearance” sales will only postpone C11.
    Though if (very foolish) people are buying them on the come relying on a hypothetical sale of their own home to close the deal it will hasten the decline of prices.
    I can almost hear the crunching sounds…

  3. Wayne says:

    Its could get much worse…no home sales to cancel.

  4. Aaron says:

    68% is a tremendously high number. I wonder if all the other major homebuilders are seeing this high of a cancellation rate or if Beazer is one of the worst performers of late?