September 14, 2007
Discount Weekend at Big Home Builder
By THE ASSOCIATED PRESS
NEWARK, Sept. 13 (AP) Hovnanian Enterprises Inc., struggling like
other home builders, is offering six-figure discounts on some of its
properties this weekend as it tries to draw interest in a slumping market.
The sales blitz involves dropping prices by more than 20 percent on
some of its prime real estate.
The discounted properties include a three-bedroom condominium by the
Hudson River in West New York, which has been reduced $240,000, or 22
percent, to $862,000 this weekend. A 25 percent discount is being
offered on a two-bedroom home in Jackson Township, N.J., which lowers
its price tag to $300,501.
Hovnanian is making the discounts during the worst housing downturn in
16 years, which has sharply cut earnings for the company and other
national home builders. Tight credit, fueled by a meltdown in the
subprime mortgage industry this year, has sidelined potential buyers.
Last week Hovnanian, based in Red Bank, N.J., reported its fourth
consecutive quarterly loss.
This weekend's sales, announced Sept. 5, involve thousands of homes in
19 states.
No other major builder is having a sale of such magnitude, but swollen
inventories are likely to lead to more discounting, said Sam Chandan,
chief economist at Reis Inc., a real estate research company.
"The downward adjustment in prices, whether for new homes or existing
homes, is going to be far more severe than what many people thought
earlier this year," Mr. Chandan said.
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