Dunmore Homes Files For Bankruptcy

From the Associated Press:

Residential homebuilder Dunmore Homes Inc. filed for Chapter 11 protection in New York, the latest victim of the faltering U.S. housing market. The privately owned builder, based Granite Bay, Calif., near Sacramento, listed assets and debts each of more than $100 million in its bankruptcy petition filed Thursday with the U.S. Bankruptcy Court in Manhattan. The company didn't say what prompted it to seek bankruptcy protection. But Michael A. Kane of Granite Bay, the sole owner of Dunmore, according to the bankruptcy filing, said in court papers that the Chapter 11 filing was in the "best interests" of the company, its employees and its creditors.

From dunmorehomes.com:

“We have engaged our lenders in a process to restructure our debts,” said Michael Kane, Dunmore Homes’ owner, “and while certain creditors took positions requiring us to seek the protection of the bankruptcy court, we intend to continue focusing on our restructuring efforts while ensuring all creditors are treated fairly.”

Looks like the moths just got burned. From the Sacramento Bee:

On a perfect Saturday in June the lemonade flowed, cookies abounded and cheerful crowds flowed through Pardee Homes' eight model homes in Natomas. It was a memorable opening day in Natomas for a Los Angeles builder launching the first of its 660 houses near downtown.

Now, just five months later, Pardee has closed the project. Sales offices that opened during a national subprime loan crisis that quickly worsened into a credit crunch have been shut. Building crews have been laid off and deals made with only four buyers canceled. Three other regional builders have done the same in recent weeks. Their actions are the latest indicator of how brutal the Sacramento market has become for area home builders as they fight one another for sales.
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Milwaukee-based Homes by Towne also has mothballed its 145-home project in Natomas called Sky Park at Natomas Field and a 50-home project in Elk Grove called Spring Gardens. The builder has stopped construction at its 227-home Yuba County project called River Landing at Plumas Lakes...Rocklin-based Nouveau Homes has taken similar action with a 51-home project in Lincoln called Crystalwood. It was the builder's only active development, according to Costa Mesa-based building industry tracker Hanley Wood Market Intelligence.
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"They can't compete anymore. All these builders, they aren't making any money on any of these homes," said Kathryn Boyce, analyst for Costa Mesa-based Hanley Wood Market Intelligence. "They're losing money on all the homes they're selling right now." Ironically, Boyce said, it's the aggressive price cuts and deals that builders are using to woo buyers that are making more buyers leery. She said many fear their houses will be worth less a week after they unpack.

From the Modesto Bee:

It's been a tough year for builders, and those who attended Thursday's Central California Housing Summit heard little cheery news about the near future...New-home sales have plummeted 62 percent in Stanislaus, San Joaquin and Merced counties since their 2004 peak, said Rick Baldonado, regional director of Hanley Wood Market Intelligence. He said sales in the region's 248 subdivisions are so slow that, at the current pace, it would take nearly four years to fill all the empty lots..."Standing inventory is definitely a thorn in our side," Baldonado told the builders. He asked audience members to tell him when they thought the market would turn around, and the majority there predicted 2010.
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To increase sales, the speakers agreed homes need to cost less...Alan Nevin, the California Building Industry Association's chief economist...predicted that empty lots in many large-home subdivisions will be sold at significantly reduced prices to other builders, who then may be able to build houses priced below $250,000.

From the Modesto Bee:

A Stockton builder's decision to halt work on an Oakdale Road subdivision means the company also is pausing on street improvements it agreed to install. Florsheim Homes postponed its Rose Way development in September after it began preliminary work on the 26-acre project between Mable Avenue and a planned extension of Claratina Avenue. As a result, Oakdale Road cuts off to a ditch on its west side.

From the Sacramento Business Journal:

A deal to sell Southport Industrial Park in West Sacramento has tanked due to the credit crunch, according to the broker marketing the high-profile property.

From the Appeal Democrat:

A decline in the housing market is not only affecting homeowners trying to sell their homes, but also Yuba County’s financial status. County officials estimated revenues from property tax values would increase by 11 percent for the 2007-08 fiscal year, but the housing market decline shows an increase of only 8 to 9 percent, a reduction of roughly $300,000. The projection has caused Yuba County officials to request an evaluation of building and impact fees.

From the Sacramento Bee:

Credit the global economy, said David Hill, executive chairman of Chicago-based Kimball Hill Homes, which builds in Sacramento and Stockton. Get over the idea of a domestic home building industry that relies on conditions inside the United States to thrive. The world's money is rushing in, he said, transforming the building industry that has so transformed the capital region in recent years.

"The Germans and many others are looking at a chance to own a piece of this great economy of ours," he told builders. Brush up on your foreign language skills, he advised local land brokers. As struggling area builders face prospects of land sell-offs, rich foreign investors will be there to buy.

Hill asked builders to think about who buys homes. Nearly one in three buyers now are recent immigrants – what Hill called "foreign-sourced homebuyers." And he sounded a warning. They're being made to feel unwelcome in the United States. "We're doing a lot of things in this country to make sure the foreign-sourced buyers can't get citizenship very easily, can't get documented very easily and are really looked at very suspiciously," Hill said. "All I know is there is fewer of them now. And they are subtracted from the demand."