HomeLatest NewsFeatured HomebuildersHome Buyer ResourcesBinding ArbitrationResource LinksSubmit ComplaintsView ComplaintsTake Action 101!Report Mortgage FraudMortgage Fraud NewsForeclosure NewsConstruction DefectsHome DefectsPhoto GalleryFoundation ProblemsHomeowner Website LinksHOA Reform

HUD FEATURE
1981 - 2015 HUD's
Legacy of Scandals

HOBB-Over 1M visits monthly
Daily Visitors Over 37,000
 Highest Daily 70,723

Main Menu
Home
Latest News
Featured Homebuilders
Home Buyer Resources
Binding Arbitration
Resource Links
Submit Complaints
View Complaints
Take Action 101!
Report Mortgage Fraud
Mortgage Fraud News
Foreclosure News
Construction Defects
Home Defects
Photo Gallery
Foundation Problems
Homeowner Website Links
HOA Reform
Featured Topics
Builder Death Spiral
Report Mortgage Fraud
Foreclosure Special Report
Mold & New Home Guide
Special News Reports
Centex & Habitability
How Fast Can They Build Them?
TRCC Editorial
Texas TRCC Scandal
Texas Watch - Tell Lawmakers
TRCC Recommendations
Sandra Bullock
People's Lawyer
Prevent Nightmare Homes
Choice Homes
Smart Money
Weekly Update Message
HOBB Archives
About HOBB
Contact Us
Fair Use Notice
Legislative Work
Your House

 HOBB News Alerts
and Updates

Click Here to Subscribe

Support HOBB - Become a Sustaining Member
Who's Online
ABC Special Report
Investigation: New Home Heartbreak
Trump - NAHB Homebuilders Shoddy Construction and Forced Arbitration

Property Rights Denied!
Protecting HOA Members' Rights is NOT The #1 Priority
of Managed Communities
The High Price of Managed Living, Books and Records Hidden
gives appearances of impropriety
Editorial Feature: Part One - Are Homeowners' Rights a Myth? 

Part Two: HOA Bureaucrats Overstep Their Authority

Big Builders Billions in Tax Refunds More Profitable than Real Homebuilding Business
Saturday, 20 March 2010

Builder rake in refunds
Several publicly traded companies, including Lennar Corp., Hovnanian Enterprises Inc. and Pulte Homes Inc., expect to rake in roughly $2.5 billion in federal tax refunds combined, according to company filings. Lawmakers amended the tax code last fall to help struggling companies stay in business by essentially giving them a greater opportunity to recoup previously paid taxes. The move has helped some of the biggest builders turn a profit for the first time in years. But some small builders say the souped-up tax break is primarily giving their large rivals yet another competitive edge. That's because the latest windfall looks less like a lifeline and more like a war chest. Several large builders are now sitting on more than $1 billion in cash and are snapping up tracts of land to be ready for the next building boom.

Builder rake in refunds
GAINS DRIVE PROFITS: Smaller companies say the amended tax code is giving their larger rivals an advantage.

Thursday, March 18, 2010
By ALEX VEIGA

The Associated Press  
It's tax season, and the IRS is being particularly generous to some of the nation's largest homebuilders.

Several publicly traded companies, including Lennar Corp., Hovnanian Enterprises Inc. and Pulte Homes Inc., expect to rake in roughly $2.5 billion in federal tax refunds combined, according to company filings.

Lawmakers amended the tax code last fall to help struggling companies stay in business by essentially giving them a greater opportunity to recoup previously paid taxes. The move has helped some of the biggest builders turn a profit for the first time in years

But some small builders say the souped-up tax break is primarily giving their large rivals yet another competitive edge. That's because the latest windfall looks less like a lifeline and more like a war chest. Several large builders are now sitting on more than $1 billion in cash and are snapping up tracts of land to be ready for the next building boom.

"These public (builders) sold hundreds of millions of dollars worth of land and took huge losses and wound up with hundreds of millions of dollars of checks from the government sitting on their balance books," said Ken Endelson, CEO of Kenco Communities in Boca Raton, Fla. "It was a real bailout. No different than the banks."

In November, Congress passed a law that lets companies of all sizes that are losing money reach back five years and get a refund for taxes paid when they were making money. Previously, large companies were limited to recouping taxes paid up to two years earlier.

That extension was a boon to builders because the economy and the housing market were flying high five years ago and they couldn't put up new houses fast enough.

In recent weeks, builders have reported quarterly results that include the gains they expect to receive from tax refunds.

Among those to post a profit were KB Home, Lennar, Hovnanian, D.R. Horton Inc., Beazer Homes USA Inc., Ryland Group Inc. and Meritage Homes Corp.

Pulte, the nation's largest builder, lost money in its fourth quarter despite an $800 million tax benefit.

Hovnanian, which is based in Red Bank, N.J., earned $236 million for its fiscal first quarter -- its first profit since 2006. But without a $291 million tax benefit, the company lost about $55 million, or 69 cents a share.

To stay afloat, builders laid off thousands of employees, halted developments and generated cash by selling land at sharp discounts. That led to losses they are using to collect tax benefits now.

The National Association of Home Builders, which lobbied for the change in the tax code last year, said the tax break is aiding all builders.

"It's helped a lot of balance sheets, whether you're big or small," said Joe Robson, the trade association's immediate past chairman. But he noted large builders have always had an advantage over smaller companies.

Credit Suisse analyst Nishu Sood, estimates that a dozen of the publicly traded builders paid about $8.5 billion in taxes between the booming years of 2004 and 2007. As of November, the builders had recouped $3.7 billion in refunds.

At the current pace, the large builders combined are on track to recover at least $6 billion in refunds.

Many large builders have been buying up developed home sites, often from banks that have repossessed the land from other builders unable to make loan payments.

It's a smart move because the land is cheaper now and homes built on it can be sold eventually at a higher profit.

"They're taking commanding market share," Said Michael Sivage, CEO of Sivage Homes, which builds homes in Albuquerque, N.M., and San Antonio, Texas.

http://www.pe.com/business/local/stories/PE_Biz_W_builders19.3746f1a.html

 
< Prev   Next >

 Texas, First Home Lemon Law Debated in the Nation
Homebuyers Need a Home Lemon Law

Search HOBB.org

 Beware of HOA Payment Plan! 

HOA Foreclosures Big Business 
ON THE COMMONS with Shu Bartholomew
Dr. Evan McKenzie HOA Governments

Reckless Endangerment
BY: GRETCHEN MORGENSON
and JOSHUA ROSNER

Outsized Ambition, Greed and
Corruption Led to
Economic Armageddon


Amazon
Barnes & Noble

 Feature
Rise and Fall of Predatory Lending and Housing

NY Times: Building Flawed American Dreams 
Read CATO Institute: 
HUD Scandals

Listen to NPR:
Reckless Endangerman
by
Gretchen Morgenson : How 'Reckless' Greed Contributed
to Financial Crisis - Fannie Mae

ATTENTION TAXPAYERS:
 
Pulte-Centex $900 Million Grant
Bad Guys at Countrywide Profit on Mortgage Toxins

NPR Special Report
Part I Listen Now
Perry Home - No Warranty 
Part II Listen Now
Texas Favors Builders

Washington Post
The housing bubble, in four chapters
BusinessWeek Special Reports
Bonfire of the Builders
Homebuilders helped fuel the housing crisis
Housing: That Sinking Feeling

Arbitration Fairness Now!
Sen Feingold, Rep Johnson
Introduce Consumer Justice
 
Senate Passes Franken
Binding Arbitration Amendment
  
   
Public Citizen Report 
Home Court Advantage
 

 (See photos) & Latest News

Judiciary & Civil Jurisprudence
 Arbitration Hearing,
Video of Homeowners
Testimony Advance to 1:55

Arbitration Bill Passes Senate
Four years to fight to get in court is not a day in Court, Jamie Leigh Jones 

 


Legislative
Watch
TEXAS ABOLISHES BUILDERS
PROTECTION AGENCY TRCC
 


Texas Regulates Homebuyers
 
Texas Comptroller Condemns TRCC Builder Protection Agency
TRCC is the punishment phase of homeownership in Texas

HOBB Update Messages

Consumer Affairs Builder Complaints

 TRCC Implosion
 TRCC Shut Down
 Sunset Report

IS YOUR STATE NEXT?
As Goes Texas So Goes the Nation
Knowledge and Financial Responsibility are still Optional for Texas Home Builders

OUTSTANDING FOX4 REPORT
TRCC from Bad to Worse
Case of the Crooked House

Perry's Gifts Keep on Talking
Sun Never Sets On Politicians Taking Homebuilder Money

TRCC AN ARRESTING EXPERIENCE
The Pat and Bob Egert Building & TRCC Experience 

Homebuilder's Right-To-Repair Illusion

Builders Looking for Federal Handouts

How Texas Home Building Industry shaped the TRCC to regulate buyers 

SpotLight
LiveTalk Internet

Build it right the first time
An interview with Janet Ahmad

HUD's Broken System
From HUD's Deregulation to Disgrace
Did HUD Secretary Cisneros
 Mastermind Predatory Lending?

Take Action
Ban Binding Mandatory Arbitration

Send a message urging your Congressman to support all legislation banning this unfair practice

Voting Texas Style
What Lawmaker is Voting for you?

Most Read

 Give Me Back My Rights Campaign
Model State Arbitration Legislation
Fair Homebuyer Contract Model

Bad Binding Arbitration Experience?
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
or call 1-210-402-6800

NCPIRG
Homebuyers' Bill of Rights
Tips for a Better Built Home and to Protect Your Investment

Drum Major Institute
for Public Policy

Tort Deform
Report Your Arbitration Experience

Homebuilding Texas Style
And the walls came
tumblin' down

 Texas Homebuilder
Bob Perry Political Contributions

  The Agency Bob Perry Built
 TRCC Connection News
Tort Reform

NPR Interview - Perry's
Political influence movement.
Click to listen 

Texas Homebuyers
Fight for Rights

TRCC Abolish or Fix
or Pass Home Lemon Law
or
Homebuyers Bill of Rights

POLICYHOLDERS OF AMERICA POLL
82% would not vote back in office any legislator, regardless of party, that is soft on bad homebuilders?

REWARD
MOST WANTED

ARIZONA REGISTRAR OF CONTRACTORS
Have you seen any of these individuals

Pulte Homeowner Survey
Warranty & Mortgage Experience
 Click to participate

Tort Reform Feature
Texas Monthly
 Hurt? Injured? Need a Lawyer? Too Bad!

Special Money Report
Big Money and Shoddy Construction:Texas Home Buyers Left Out in the Cold
Read More
Read Report: Big Money…
Home Builder Money Source of Influence

Letters to the Editor
Write your letters to the Editor

Homeowner Websites

top of page

© 2017 HomeOwners for Better Building
Joomla! is Free Software released under the GNU/GPL License.