Tuesday Morning: Home Builder Lennar Losing Almost $3 Million a Day

Good Morning. The big home builder Lennar reported this morning that it lost $244 million in the quarter ending May 30 -- that's $2.7 million a day by our math. Not good.

From Reuters: "As we look to our third quarter and the remainder of 2007, we continue to see weak, and perhaps deteriorating, market conditions," Stuart Miller, chief executive, said in a statement.

Thoughts? Comments?
Photo Credit: Reuters

Comments

[mark]

what goes up must come down -realestate is no exception-as with any business

[Willie]

Nothing but paper losses. It would look good on their tax returnsp. Now, if the market improves and the value of the land goes up, will the adjust retroactively and pay their fair share of taxes on their capital gain for land appreciation, not!

[Cal]

While most (not all) of the losses are paper losses, sometime in the past they reported paper gains and are revaluing assets to a new lower price. And some of that is real dollars because their is a base cost associated with the land and development of it and that is real money out the door. They are saying that they had land at value X and now it is value Y and Y is less than X. Price X could be actual cost or it could be actual cost plus appreciation.

We are already into the first month of the next quarter so Miller already has an initial read on this quarter and say things aren't getting better.