Real Estate

Hovnanian Sells More Than 2,100 Homes During Weekend Blitz


Hovnanian Enterprises said it sold more than 2,100 homes during its weekend sales campaign which saw prices slashed as much as 25% on some luxury homes.

"All in all, the campaign was a huge success," said CEO Ara Hovnanian, in a prepared statement released Monday. "The high level of traffic we saw in our sales offices and models over the weekend and over the past several weeks convinces us that there are interested buyers in the market today."

The Red Bank, N.J.-based homebuilder said it signed approximately 1,700 contracts and received more than 400 sales deposits. In some cases, the company said, there was only enough time to take deposits rather than sign contracts. Hovnanian expects to finish paperwork for those deals this week.

The weekend sales campaign was an attempt to spark buyer interest amid the worst housing downturn in 16 years.

Hovnanian shares, which jumped 9.7% last Friday after the sales campaign was announced, added more than 3% on Monday in midday trading.

The company noted on Monday that it also booked some advance orders for planned or unfinished homes set for construction.

"We typically maintain a conservative level of started, unsold homes in each community, and the weekend sales should result in one of the lowest company-wide inventory levels of unsold homes under construction in our recent history," CEO Hovnanian said in a release.

The sales blitz, which began last Friday at 9 a.m. and ended at 9 p.m. on Sunday, involved thousands of homes in 19 states and was promoted by the company in radio and print ads as the "Deal of the Century."

"It has been phenomenally successful," Doug Fenichel, head of public relations for Hovnanian's Northeast region, told on Sunday evening.

Hovnanian currently does not have plans to conduct a similar sale in the future, according to Fenichel.

"We're always trying to provide value, but this was called the deal of the century because it was a one-time shot," Fenichel said. "We needed to give people a little push to get them in and tomorrow prices go back to normal."

Tight credit, fueled by a meltdown in the subprime mortgage industry this year, has sidelined potential buyers who were already wary following years of escalating home prices.

Hovnanian recently reported a quarterly loss of $1.27 a share, compared with a profit of $1.15 a share in the same period last year.