Sales of newly constructed homes and contracts to build them are way off from the peak year of 2005. But cash-rich builders are betting on a turn in the market for new homes. They are buying land again. In some cases, builders are competing with each other for the best locations.
As with other companies on the stock market, large builders have seen the price of their shares almost double in the last year. The number of lots owned or controlled by a dozen of the biggest builders rose in the second half of 2009, according to a recent study.
They are scooping up bargains and buying what they need to meet expected demand for some time to come, showing faith in new home sales for this year and next year.