According to a report in Businessweek.com, 1st quarter earnings for the luxury home builder were down 19% from the same period a year ago and lower than had been projected. CEO Robert Toll indicated they were facing significant challenges in most of their markets. Toll brothers is one of the nation’s largest builders, and their challenges are shared by large builders everywhere.
Toll brothers points to fallout from the sub-prime debacle as the leading reason things have slowed more than expected. While most of their customers don’t use sub-prime loans, the stricter standards have affected everyone. It will be interesting to see if that bears out in existing home sales as well. There’s no question easy money helped fuel the RE boon. It remains to be seen how much the tighter standards will affect the downturn.
This is an article worth reading, although it is more oriented to the person who invests in RE stocks, than the person who invests in RE.
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