by Bill McBride on 11/08/2016 05:01:00 PM
Tuesday, November 08, 2016
From housing economist Tom Lawler:
Below is a table showing selected operating results of large publicly-traded builders for the quarter ended September 30, 2016.
In aggregate these seven large builders showed combined net home orders of 24,648 last quarter, up 8.4% from the comparable quarter of 2015. Sales per community for these combined builders last quarter were up 6.6% YOY, reflecting very slow growth in the number of active communities.
In stark contrast to these builders’ results, the Census Bureaus’s preliminary estimate of new single-family home sales for the third quarter of 2016 was 147,000 (not seasonally adjusted), up 23.5% from the comparable quarter of 2015.
There are many reasons, of course for large builder results to differ from Census estimates. First, of course, is that market shares can change significantly. Second, Census treats sales cancellations differently than builders do in their financial. Third, the geographic “footprint” of these large builders does not reflect that of the US as a whole. And finally, there may be timing differences between when builders “recognize” a sale and when a sale shows up the Census’ Survey of Construction.
Having said that, however, the latest quarterly results of these large builders shows unusually slow growth relative to the growth in Census’ estimate of new SF home sales. Given that preliminary Census home sales estimates are often revised significantly, in part because Census must “guesstimate” sales of homes for which a permit has not yet been issued, I believe there is a better-than-even change that third-quarter new home sales as estimate by the Census Bureau will be revised downward in the next monthly release.
|Net Orders||Settlements||Average Closing|
|Qtr. Ended:||9/16||9/15||% Chg||9/16||9/15||% Chg||9/16||9/15||% Chg|
*Note: CalAtlantic was formed with the merger of Standard Pacific and Ryland, completed in October 2015. The Q3/2015 statistics for CalAtlantic are pro forma statistics for Standard Pacific and Ryland combined