Hovnanian sees better days ahead for the housing market

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The worst is over for the housing market.

Or so says Hovnanian Enterprises’ CEO Ara Hovnanian.

‘Several signals of a housing industry bottom have become apparent,’ Hovnanian said in a conference call Thursday with Wall Street analysts and investors.

The Red Bank, N.J., homebuilder has seen a recent pickup in home orders and a slowing in house-price declines, Hovnanian said.

“After 15 quarters in a row of shrinking net contracts per community, we are finally seeing the trend reverse,” Hovnanian said. The pace is approaching 2006 levels, he said.

The company is responding by buying land, increasing home prices, reducing incentives and reopening developments in Southern California and Arizona that had been mothballed, he said.

Hovnanian Enterprises, which sells homes in 18 states, has begun an advertising campaign with the slogan “Pounce Before the Bounce” to persuade the public that ‘this may be their last opportunity to buy homes at rock bottom prices while obtaining favorable mortgage interest rates,’ he said.

On Wednesday, the company said it narrowed its loss for the quarter ended in July, reporting a loss of $168.9 million compared with a loss of $202.5 million in the year-earlier period. Revenue fell 45% to $387.1 million.

“It’s disappointing to have continued losses,” Hovnanian said. “On the other hand, there were many positive signs that we’re at the bottom and perhaps beginning the recovery.”

-- Nancy Rivera Brooks