Slashing sticker prices and throwing in extra amenities, Hovnanian Enterprises reports that its weekend sales push on new housing units nationwide exceeded expectations.
Wall Street cheered the report, boosting the battered homebuilder’s stock price yesterday.
From a report on Bloomberg.com:
The company had gross sales of 2,100 homes. More than 1,700 potential buyers signed contracts and 400 gave deposits, Red Bank, New Jersey-based Hovnanian said today in a statement. The sale began on Sept. 14 and ended yesterday. It has boosted the company’s shares almost 13 percent in the past two trading days.
Chief Executive Officer Ara Hovnanian said last week he hoped to sell 1,000 homes in the “Deal of the Century” blitz. Today he said the event “convinces us that there are interested buyers in the market.” The sale shows that buyers are waiting for prices to fall before purchasing, said Dan Poole, assistant director of equity research at National City Bank in Cleveland.
“There is a lot of pent-up demand, but buyers are behaving rationally,” said Poole, who helps manage $34 billion. “They know that discounts are out there, and they’re a little bit leery of the market. So they’re just treading very gently, and when you gave them a reason to step up to the plate, they did.”
Hovnanian rose 33 cents, or 3 percent, to $11.33 as of 4 p.m. in New York Stock Exchange composite trading. The stock is down 67 percent this year.
This from the Wall Street Journal:
On certain New Jersey and New York properties, buyers could save up to $149,600, Mr. Hovnanian said. Borrowers, however, had to use the Red Bank, N.J., company’s lender and it was unclear which homes got that discount.
