Wednesday, May 09, 2007

Tightening of lending standards affecting all homebuilders

So much for “containment”…Marketwatch has a report on Toll Bros. where the CEO is quoted to the effect that “the impact of stricter lending standards arising from problems in the subprime market is negatively affecting affordability at lower price points”…related detail from this link that backs up the connection between subprime issues and Toll’s typical customer is “About 70% of cancellations in the latest quarter were from contracts signed more than nine months ago. “This means that buyers are typically cancelling closer to closing, likely due to price or inability to sell their existing home, instead of financing issues that typically occur earlier in the process,” wrote Banc of America Securities analyst Daniel Oppenheim in a report to clients”…

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