As I’m sure many of you know, home sales are at some of their lowest levels in decades. About 18.3 million houses are vacant, a number that is only expected to rise by the end of this year. Many companies have practically stopped building new homes. Those that haven’t are facing unbelievable losses.
KB Home, one of the largest residential developers in the country, is a great example of one of the daring firms. According to an April 6th Los Angeles Times article, this company reported a net loss of 114.5 million dollars this last quarter. Let me clarify: this huge loss occurred during just a single quarter, not over an entire year! Revenues are also down substantially: 25% from last year. Keep it mind, KB Home was a huge moneymaker a few years ago when real estate was booming. I think the troubles this company is facing make it clear how chaotic and fragile today’s market for real estate really is.
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