(Read more: Map: Tracking the recovery)

While inventories improved slightly in August on a national basis, up 0.4 percent month-to-month, they are still down 6.3 percent from a year ago, according to the National Association of Realtors.

While home sales were higher in August, the Realtors said it was, “the last hurrah,” as several indicators showed buyer traffic slowed dramatically at the end of the summer.

“The sharpest falloff in the HousingPulse Homebuyer Traffic Indexes was seen among current homeowners, the largest group of home purchasers in this year’s housing market. The first-time homebuyer group also saw a decline in its traffic index,” according to a new report from Campbell/Inside Mortgage Finance.

The fall and winter months are traditionally the slowest in the housing business, and weaker demand will affect prices. Sales of newly built homes have not exactly been gangbusters, and new orders at both Lennar and KB Home were weaker than expected. Make no mistake, underlying demand exists, it’s just a question of when it emerges in force.

So far, even weak demand has pushed prices higher, again, due to historically low supply.

(Read more: Real estate’s new frontier: Crowdfunding)

“Construction of single-family homes has been depressed since late 2007, while the U.S. population has increased by more than 12 million over that time,” said economist Patrick Newport of IHS Global Insight. “Since underlying demand is, by our estimate, running at a rate nearly twice that of housing completions, the shortages are likely to get larger before getting smaller.”

This means that home-price gains, as measured by the Case-Shiller indexes, are likely to remain strong for some time, even if they retreat some from the current pace.”

—By CNBC’s Diana Olick. Follow her on Twitter @Diana_Olick.

Questions?Comments? facebook.com/DianaOlickCNBC.

Article source: http://www.cnbc.com/id/101058777

Even though home building is on the rise, home builder stocks have gotten creamed over the last 3 months, including PulteGroup, KB Home and DR Horton.

(Read more: He’s not buying a house—why is Obama on Zillow?)

—By CNBC’s Diana Olick. Follow her on Twitter @Diana_Olick.

Questions?Comments? facebook.com/DianaOlickCNBC

Article source: http://www.cnbc.com/id/100964905

The Syrah Versailles is one of four home prototypes available in Toll Brothers’ The Reserve development in Pleasanton. 

Blanca Torres
Reporter- San Francisco Business Times

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In another sign that the single-family home market is rebounding in the Bay Area, Toll Brothers, one of the country’s largest homebuilders, is now selling homes in the Reserve, a 19-unit luxury home development in Pleasanton.

The development, at the corner of Manoir Lane and Vineyard Avenue, is surrounded by vineyards. The homes start at $1.3 million and range in size from 3,800 to 4,160 square feet with 4 or 5 bedrooms.

Toll Brothers (NYSE: TOL) designed four different prototypes for the development, all named after wine varietals including Cabernet, Merlot, Syrah and Riesling.

The company joins other homebuilders including KB Home (NYSE: KBH), Shea Homes and Summerhill Homes, who have been debuting new home developments in the Bay Area.

Demand for single family homes is on the rise and homebuilders say there aren’t enough development sites available to keep up.

Toll Brothers, based in Pennsylvania, reported revenue of $1.68 billion for the most recent fiscal year ending July 31, 2012.

Blanca Torres covers East Bay real estate for the San Francisco Business Times.

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Article source: http://www.bizjournals.com/sanfrancisco/blog/real-estate/2012/10/toll-brothers-opens-pleasanton.html

KB Home (KBH: 5.41 +2.66%) wants to build energy-efficient homes on nearly 900 lots in several San Francisco Bay area communities.

But will reticent consumers want to buy?

The Los Angeles-based volume builder — whose stock price tumbled Wednesday to a 52-week low — is launching the projects during a still-shaky housing market, but consultants say the Bay area is one of the few markets with strong fundamentals for homebuilders.

The new residential developments are in the cities of Dublin, Fremont, Martinez, Morgan Hill, Petaluma, Santa Clara and Walnut Creek. KB opened several model homes in the developments where they will offer single-family residences and attached town homes. Additional model homes are scheduled to open this fall.

KB said all homes in the communities will be Energy Star and GreenPoint rated to operate more efficiently — something that should play well in the Bay area where green isn’t just about cost efficiency but plays to people’s cultural and political ideologies, noted Dean Wehrli, senior manager with John Burns Real Estate Consulting.

“Demand for lots in those key areas is actually pretty intense,” said Wehrli, who said the area tends to be chronically under-supplied.

“The Bay area is probably the strongest housing market in California, maybe Orange County rivals it,” he said. Still, some areas are better off than others with Walnut Creek being a “golden address” but KB may find the more blue-collar Martinez a bit more challenging, Wehrli said.

Sales of newly built homes fell 0.7% in July — to their lowest level in six months, according to data released this week by the Commerce Department. Analysts said the housing market has years of stalled recovery ahead.

New home sales will compete with a flood of distressed properties still on the market, which typically sell at a discount although the numbers of distressed properties competing with new home sales in California are declining. In San Francisco County, 17.6% of all sales during the first quarter were either REO sales or short sales, according to RealtyTrac, down from nearly 20% in the year-ago quarter. In Contra Costa County, where the city of Martinez is located, 51.6% of all homes sales during 1Q were foreclosure-related sales, down from 53.2% a year ago.

Still, San Francisco has performed better than many others because of its desirability and limited land supply, which has made it immune to big housing declines, said Scott Sambucci, vice president of data analytics for Altos Research.

Homebuilders may also be taking advantage of cheap land, he noted, and consumers may take the plunge if they can get a good deal.

“If I can get a brand new house for $300 a square foot vs. a house that’s been lived in for $250 per square foot, maybe I’ll just buy a new house,” he said. That could be true even in struggling communities flooded with REOs like Martinez where consumers may not have the cash to pay for extensive renovations. Getting a new house with a 3% down FHA loan that won’t require any significant work for 10 years might be very appealing, he said.

Nationwide, weak job creation and uncertainty about job stability could mean slow movement on new home construction, analysts predict, with record-low mortgage rates not enough to move the market.

National builders continue to struggle as homebuyers stay on the sidelines. KB’s second-quarter loss widened as home sales declined and revenue fell during the three months ended May 31.

The homebuilder posted a second-quarter loss of $68.5 million, or 89 cents per share, compared to a loss of $30.7 million, or 40 cents per share, a year ago.

Write to Kerry Curry.

Follow her on Twitter @communicatorKLC.

Article source: http://www.housingwire.com/2011/08/24/kb-home-launches-green-communities-in-bay-area

I was hoping not to have to write this particular piece, but it seems I may have no choice, so here we go with housing.

What happens to today’s housing market without FHA loans?

Right now FHA loans are about 20 percent of the overall mortgage market (purchases and refis) and 40 percent of purchase applications.

Compare that to around 11 percent of the overall market during the last shutdown in 1995. For the nation’s big public home builders, it’s far more of an impact, according to analysts.

FHA Share of Borrowers:

“We have been alerted that FHA will maintain the ability for lenders to secure case numbers – one of the first steps in originating a FHA mortgage – and underwriting will not be impacted either. However, lenders will be challenged to close these loans during a government shutdown as they will not be able to secure mortgage insurance,” says Bob Walters, chief economist at Quicken Loans.

No FHA, which is really the only low down payment (3.5 percent) game in town for the somewhat less credit-worthy, would hit first time buyers particularly hard:

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Article source: http://www.cnbc.com/id/42495087?__source=RSS*blog*&par=RSS

We didn’t need KB Home’s dismal quarterly earnings release today to tell us that foreclosures are digging home builders into an even deeper hole.

We knew that already; this just put a period on it.

KB [ KBH 11.69  +0.00 (+0.00%) ] caters to first time home buyers, with smaller, less expensive homes. Unfortunately, bargain basement foreclosures, many of which are relatively new construction, offer more home for the money, and first time buyers are making up less of the buying population today than historical norms.

Right now banks are pushing foreclosures to market faster than ever, perhaps due to improving paperwork procedures, and perhaps due to the fear of some kind of settlement/penalty coming down the pike from state attorneys general and federal regulators. In any case, the volumes are rising, and that hurts home prices and home builders.

“We continue to think prices will be under pressure throughout 2011; we may have to re-evaluate all of our assumptions given the weakness we’re seeing right now,” notes analyst Buck Horne at Raymond James.

So what’s a builder to do?

Well, Lennar [ LEN 18.32  +0.00 (+0.00%) ] has been investing in troubled mortgages through its Rialto Capital Advisors division, and that has helped boost its bottom line.

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