House Build Construction Projects Stabilizing
Build construction projects are expected to increase and stabilize in the coming months. This was according to the chief of Lennar Corp. Stuart Miller, as he launched his review of the company’s performance during the third quarter of this year. Miller expressed that the house building industry is already on its way to recovery, as low prices, government incentives and low interest rates have been encouraging to the market. More home buyers are encouraged to purchase their new home, and more construction companies are not afraid to launch new projects anymore.
Lennar Corp has seen firsthand the improvements in the market, more particularly the increase in the confidence of people and home buyers. However, there are still some murky areas in the house construction industry. For instance, foreclosures are still present and even continue to increase in some areas. This presents a very tough competition to new houses, since foreclosed properties sell at a more affordable price. Lower mortgage rates and different programs of the government are also threatening the continuous increase of build construction projects.
This indicates that even though the housing market has already recovered, there are still some threats that may bring it back to the woods. Home buyers are now taking advantage of the prices and of the relatively good market perspective. As the country recovers from the difficult economic recession, Lennar expects it to be able to produce profit next year.
Last quarter, the company lost $171.6 million, significantly higher than its loss a year ago, which was at $89 million. Even though build construction orders have increased for new houses, there is still a lot of work to do and a lot of loss to be recovered.
The average price of a house for sale decreased by 11 percent to $239,999. On the other hand, this helped the demand to increase, and so has dropped incentives for home buyers. According to executives of Lennar Corp, they plan to control the amount of construction projects until the economy of the country has already fully recovered.
