Two of the nation’s largest home builders reported quarterly financial results that were weaker than the year before, showing that the industry continues struggling to sell homes as the housing crisis drags through its fifth year.
The pre-market results from PulteGroup Inc. PHM -0.87% and DR Horton DHI -0.84%continue a bleak earnings season for the battered sector. Wednesday, Ryland Group Inc. RYL +3.36% reported a second-quarter loss. Last week, NVR. Inc. NVR +0.22% , long the sector’s top performer because it made money during the downturn, said that it saw profits slashed by nearly half when compared to a year earlier.
Home sales typically pick up in the spring, as buyers emerge from their winter lulls and rush to move before the new school year starts. But this year’s season was a dud. Both Pulte and Horton saw closings fall, while orders didn’t spike, which weighed on revenue.
The market continues to be hampered by high unemployment–the national rate now stands at 9.2%–and tight lending standards, which are preventing would-be buyers from securing mortgages. A fresh concern is the debt-ceiling debate, which some real-estate agents say has consumers abandoning or halting deals because they’re worried borrowing costs are set to rise.