Even as new U.S. home sales plunged to a record low in February, home builder Lennar Corp. posted an unexpected profit for the three months that ended Feb. 28 thanks to cost-cutting measures and investments in distressed real estate assets, the Miami-based company said this morning. Lennar’s net income for the first quarter of $27.4 million, or 14 cents per share, well above analysts’ predictions of a loss of 7 cents per share. Analysts told Bloomberg News that the boost came largely from its Rialto Capital subsidiary, which was launched in 2007 to focus on distressed properties and loan workouts and was responsible for $11 million in operating income during the first quarter. [more]

Even though sales are lethargic in the new home market nationwide, home builder stocks are hanging tough, according to CNNMoney. Despite a 17 percent drop in the number of new homes sold between February and January, major U.S. home builders like Ryland, KB Home and Lennar have seen their shares stay relatively flat recently, while PulteGroup actually saw its shares climb 3 percent. Ryan Detrick, a senior technical strategist with Schaffer’s Investment Research, said he’s encouraged by the builders’ stock performance. “I’m not saying you should go buy a house because nobody knows where prices are going,” Detrick said. “But even though the data is terrible, builder stocks are holding up.” [CNNMoney]

Home builders are slashing prices to keep buying activity up since the first-time homebuyer tax credit expired at the end of April, according to the Wall Street Journal. While many developers nationwide, including Lennar and Beazer Homes, accelerated their speculative building to capitalize on the tax credit, its wake is leaving some with extra inventory on their hands. Jody Kahn, a vice president with John Burns Real Estate Consulting, said that the decision to cut prices may be a way to ride out the tide. “[They] want to keep the momentum going,” Kahn said. “Traffic and sales fell off pretty dramatically in May.” [WSJ]

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Home builders are slashing prices to keep buying activity up since the first-time homebuyer tax credit expired at the end of April, according to the Wall Street Journal. While many developers nationwide, including Lennar and Beazer Homes, accelerated their speculative building to capitalize on the tax credit, its wake is leaving some with extra inventory on their hands. Jody Kahn, a vice president with John Burns Real Estate Consulting, said that the decision to cut prices may be a way to ride out the tide. “[They] want to keep the momentum going,” Kahn said. “Traffic and sales fell off pretty dramatically in May.” [WSJ]

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At left and right: Renderings of One Thousand Ocean. Center: Jamie Techlin, LXR president of development, on the terraces of One Thousand Ocean, overlooking its construction

From the South Florida Web site: Stalled luxury building projects abound in Boca Raton.

So a recent spike in sales at the almost-finished ultra-luxurious One Thousand Ocean is cause for optimism, at least for its developer, LXR Luxury Resorts & Hotels.

On Wednesday, LXR announced the sale of six units in a six-week period from November to mid-December for nearly $23 million. That brings the total number of units sold to 32 of 52 available apartments which range in price from $3 million to $15 million.

“I just signed another contract yesterday,” said Senada Adzem of the Corcoran Sunshine Marketing Group, and senior sales associate for One Thousand Ocean.

While LXR welcomes the jump in sales activity, it doesn’t necessarily indicate an improvement in the luxury market, one of the sectors hit hardest by the South Florida real estate downturn, development experts said. Builders in the wealthy city of Boca Raton have to reconfigure projects and lower expectations, they said.

Many luxury projects will have to have a price adjustment before there’s an improvement in the market, said Lewis Goodkin, a Miami-based real estate consultant.  More

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Home builder Lennar posted a loss of $125.2 million, or 76 cents per
share, for the second quarter. The Miami-based company’s loss was
greater than the $120.9 million loss for the same period last year.
Lennar sold almost 16 percent fewer houses in the second quarter of
this year than in the second quarter of 2008. Company president and CEO
Stuart Miller said Lennar doesn’t think a housing rebound is coming
soon, since unemployment is still rising and foreclosures increasing.
“This, combined with a recent spike in mortgage rates, has made it
difficult to predict when the market will turn the corner,” Miller
said. [more]

Toll Brothers, developer of Williamsburg’s Northside Piers project, has
ended its mortgage protection plan, which promised to pay the mortgages
of homeowners who lost their jobs for up to six months. “It just wasn’t
a dial mover,” a Toll Brothers spokesperson told CNBC. Home builder
Lennar, which offered a similar plan, said its plan is still in place
in a few markets, but that it has been more effective in some markets
than others. A Lennar spokesperson said programs that buy down the
mortgage rate have been more of an incentive to buyers. [more]