Lennar's New Homes Fetch 60% Less as U.S. Market Slump Deepens

Bob Ivry writes:

``We're watching Denver, Phoenix, Austin and Tucson, but South Florida is our principal focus,'' said Arsenault, 60. ``If you're a vulture, Florida has more carrion. This stuff is lying on the ground. It's lost life. Some of the stuff in Phoenix is still breathing. Perhaps not for long.''

Arsenault said he and his three partners may buy a block of about 50 new, unsold condominiums in Orlando, Florida. They have a price in mind and they're willing to wait until they get it: 40 cents on the dollar.

``There's a risk to buying too early in the downturn, but buying too expensive is our biggest pitfall,'' he said.

Companies such as Miami-based Lennar, the biggest U.S. homebuilder by revenue, need to generate cash to make up for slowing home sales, especially this time of year, said Vicki Bryan, a Friendswood, Texas-based senior high-yield debt analyst for Gimme Credit LLC.

``They sold land at 40 cents on the dollar and they're happy to get it,'' Bryan said. ``The value of land is eroding by the minute.''