Homebuilders in a hole?

Was so busy earlier this week that I didn’t have time to make a shameless plug for a housing-related story I wrote for the print magazine looking at the deteriorating financial situation of many homebuilders. A number of small and mid-sized builders have filed bankruptcy across the country, and Moody’s, the big credit-rating agency issued a report in April predicting that a number of large homebuilders could fall out of technical compliance with their debt agreements, leaving them at the mercy of their lenders to grant waivers. For what it’s worth, executives at some of the homebuilders I interviewed didn’t agree with the critics and hence, didn’t buy the premise of the story. They think the slowdown is entirely manageable and that the industry by and large is better positioned than builders were doing the ‘90-‘91 recession, when many more went bankrupt than have so far in this slowdown.

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