New Mexico Business Weekly – July 27, 2006

Pulte Homes Inc., which owns the Phoenix-based Del Webb brand, reported a 20 percent decline in second-quarter profits.

Net income fell to $243 million, or 94 cents per share, from $304 million, or $1.15 per share, a year earlier.

The home builder said higher average home prices failed to offset a nearly 30 percent drop in new home orders.

Michigan-based Pulte (NYSE:PHM) said its average sales price per home rose 8 percent to $335,000. However, the company closed on fewer than 9,900 homes in the quarter, down 3 percent year-over-year.

Quarterly revenue rose a modest 3 percent to $3.36 billion.

“Our second-quarter results reflect the changing dynamics being experienced in the home building industry,” said Richard J. Dugas Jr., president and chief executive. “The supply of homes for sale continues to increase, while greater buyer uncertainty about purchasing a home at this time is being further impacted by their inability to sell existing homes.”

Meanwhile, the U.S. Commerce Department said June new home sales fell 3 percent, led by an 11 percent decline in sales in the Northeast. The West was the only region in the country to report an increase in new home sales last month, up 8 percent.

The Del Webb division of the company, known for its signature Sun City, Ariz. retirement communities, develops active adult and master-planned retirement communities across the U.S. and is in the process of developing such a community in central New Mexico. It started scouting for land here for one of its retirement communities in 2005 and has reportedly narrowed the field to two sites. Pulte Homes, which bought out the former Sivage Thomas Homes in Albuquerque in 2003, also has multiple residential subdivisions in the state.

Diane Arthur of the Phoenix Business Journal, an affiliate publication, and the New Mexico Business Weekly, compiled this report.