With the housing market recovery, a significant gap has been created between demand and supply of homes. Compared to the rising demand for new homes, there is a shortage of adequate supply of homes. Most of the homebuilding companies like Ryland Homes, Inc. (RYL) and NVR, Inc. (NVR), are investing heavily in building homes.
In fact, Ryland Homes has unveiled several communities over the past two months. In Dec 2013, the company unveiled new homes in Tampa, FL. The company also began construction of new homes in the community of Falls at Imperial Oaks, Houston.
Recently, Ryland homes started selling FishHawk Ranch West, at Eastern Hillsborough County community; Fla. Prices start from $250’s.
Built under Ryland Homes Tampa, FishHawk Ranch West offers 6 floor plans for one and two story homes. The single family homes comprise maple cabinets, extra rooms and porches. The kitchen is furnished with Dupont Corian countertops, 42’’ upper cabinets and stainless steel appliances, which can be further customized according to the homeowner’s preference.
The community includes reputed schools, playground, a community pool, a sports complex, dog park and walking trails. Like all new Ryland homes in FishHawk Ranch, these homes have ENERGY STAR certified appliances, LoE windows and low VOC paint.
However, rising home prices and a spike in interest/mortgage rates since May 2013 slowed down the pace of orders and traffic in the homebuilding industry. Ryland also faced a sharp fall in absorption rates of monthly orders per community as cancellation rates went up sharply. This was because buyers were taken unawares by the sudden increase in rates and customers put off their purchase decision.
Ryland carries a Zacks Rank #5 (Strong Sell). Better-ranked stocks in the homebuilding sector include Toll Brothers, Inc. (TOL) and Standard Pacific Corp. (SPF). Both the companies carry a Zacks Rank #2 (Buy).
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