KB Homes, trust them?

[rr2418]

Does anyone live in a KB home? Have you had any problems? I did a little research on them and read horror stories about them. I visited a KB subdivision and saw a home that I liked and is ready to moved in to. So what do ya'll think?

[fraga]

I live in an 11 year old KB home...so far so good...no blaring problems to speak of...

[Das Texan]

i wouldnt trust a kb subdivision but an actual kb home could be alright.

[SequSpur]

Alamo Ranch has some bad ass homes ready right now. KB is better than it used to be.. Check out JD Power and Associates for ratings.

[DisgruntledLionFan#54,927]

All the big builders have unhappy homeowners.

Quantity over quality...

[Switchman]

All the big builders have unhappy homeowners.

Quantity over quality...

lol no. Some of the stuff they used to put up was complete shit.

It got so bad KB was booed at Spurs games.

[mrsmaalox]

I think their problems are in the lower price range. KB homes in about >170k range are are very good.

[1369]

I think their problems are in the lower price range. KB homes in about >170k range are are very good.

Buddy of mine has one in that range.

They built it without eaves.

[Buddy Holly]

I think their problems are in the lower price range. KB homes in about >170k range are are very good.

Yep, their lower range stuff takes a hit in the quality department badly, or used to, I think KB has smarted up atleast locally. Their higher priced homes are basically top notch.

Their subdivision that will be behind the Alon Towne Center should be really nice.

[BigBeezie]

Alamo Ranch has some bad ass homes ready right now. KB is better than it used to be.. Check out JD Power and Associates for ratings.

And you know that all JD Power awards are for sale, right?

[johnsmith]

From what I understand, KB has done everything they could to try and fix their broken reputation.

Having said that, KB, Centex, Pulte, etc, they all use the same worthless sub-contractors and therefore, they all have their own little unique problems.

[Mark in Austin]

I work in the development industry and would encourage you to spend a couple hundred dollars to get a HIGHLY qualified home inspector of your own (as in, the inspector is looking out for your interests only, not the bank or seller). Have them inspect the house and the foundation. DO NOT count on the inspection that comes with the sale to find your potential problems.

(There is an entire neighborhood KB built that started having foundation problems within a year of people moving into the homes. Don't take anything for granted with KB.)

Critical things I would check for beyond the inspection:

Review the soils report to see what kind of soil the site has, if there was additional fill added to the site and if so what type it was, and if the foundation design was appropriate for these conditions. If there isn't a soild report, hire a geotechnical engineer to do one.

Check insulation to see if it meets the specs KB claims, or if it is there at all. If CPS offers an energy audit to see how efficient the house will be, take them up on it. A home that isn't designed with energy efficiency in mind can cost you hundreds of dollars a month - especially during the hottest and coldest parts of the year. KB could give a shit about this - the cheaper the materials they use, the more money they can make on the house, and the homeowner is left holding the bag with obscene utility payments each month.

Good luck!

[Mijo]

Review the soils report to see what kind of soil the site has, if there was additional fill added to the site and if so what type it was, and if the foundation design was appropriate for these conditions. If there isn't a soild report, hire a geotechnical engineer to do one. This is great advice although once the slab for the foundation is poured there isn't much we can do in regards to a soils boring other than take a boring outside of the foundation.

The problem with this is that the dirt contractor usually has some clause in his contract where he is paid to only compact the fill in the buildable area. Therefore the front and back yards may or may not have uncompacted fill. KB is now actually one of the few tract developers that conducts a test boring on each lot within the subdivision.

[PakiDan]

I don't know about KB Homes.... but KB Toys Rocks!

[Mark in Austin]

This is great advice although once the slab for the foundation is poured there isn't much we can do in regards to a soils boring other than take a boring outside of the foundation.

The problem with this is that the dirt contractor usually has some clause in his contract where he is paid to only compact the fill in the buildable area. Therefore the front and back yards may or may not have uncompacted fill. KB is now actually one of the few tract developers that conducts a test boring on each lot within the subdivision.

Even if not everything can be done, it is still better to have an engineer familiar with soil types in the area to come out and do what they can to determine the current state of the foundation. There are things a layperson or even a home inspector will miss that an experienced engineer won't.

(Oh, and you should ask the engineer if his or her company is or has been employed by KB or any other related companies that worked on the particular subdivision you're looking at.)

[rr2418]

(There is an entire neighborhood KB built that started having foundation problems within a year of people moving into the homes. Don't take anything for granted with KB.)!

Was this recently? It seems that alot of the complaints were around 2005 and before. What neighborhood was this? I'll certainly take your advice! Thanks!!

[davi78239]

We actually were really close to buying KB but went with Legacy out in Cibolo. KB takes 9 months to build compared to other buyers in 6 months. I guess that's because of all the KB problems.

[Summers]

n/m, edited for privacy reasons.

[boutons_]

September 27, 2007

KB Home Sales Plunge as Housing Market Worsens

By REUTERS

Filed at 9:53 a.m. ET

NEW YORK (Reuters) - KB Home <KBH.N> on Thursday posted a loss on write-downs for land values, and revenue fell 32 percent, reflecting the swelling supply of homes and tighter standards in the mortgage market that kept potential buyers on the sidelines.

The U.S. housing market has been in a steep decline for nearly two years, suffering from declining prices and sluggish demand and KB's chief executive sees conditions eroding.

"At this time, we see no signs that the housing market is stabilizing and believe it will be some time before a recovery begins," CEO Jeffrey Mezger said in a statement.

"Rising foreclosure rates are intensifying the problem of surplus inventory and will likely drive further home price reductions," he said.

KB Home, the No. 5 U.S. home builder, reported a net loss of $35.6 million, or 46 cents per share, in its quarter ended August 31, versus a profit of $153.2 million, or $1.90 per share, a year earlier. The 2007 net results include $443 million, or $5.73 per share, for the sale of KB's 49 percent stake in its French unit, Kaufman & Broad SA.

The company reported a loss from continuing operations of $478.6 million, or $6.19 per share, due largely to pretax noncash charges of $690.1 million related to the lower value of land and $107.9 million related to goodwill impairment.

"The negative impact of these conditions on our selling prices and gross margins prompted us to take substantial write-downs of inventory and goodwill in the third quarter," Mezger said.

Revenue fell 32 percent to $1.54 billion. Housing revenue fell 33 percent to $1.53 billion as the number of sales closed dropped 28 percent to 5,699 and the average selling price declined to $267,700, Los Angeles-based KB said.

"We expect housing industry conditions to continue to worsen through the end of the year and into 2008," said Mezger, repeating the forecast he told Reuters in July.

A sharp rise in defaults on subprime mortgages, which go to borrowers with checkered credit histories, prompted lenders to tighten requirements, making it difficult for all but those with good credit to get a loan.

Credit fears hit particularly hard in August, as home construction starts and permits in August fell to their lowest levels in 12 years, according to the U.S. Commerce Department. And this month the inventory of single-family homes for sale swelled to an 18-year high, the National Association of Realtors said earlier this week.

Home builders have tried to grapple with the eroding market by offering steep discounts and incentives to lure buyers.

To navigate through the rough climate, home builders have pared down debt and land holdings and have focused on generating cash and shoring up balance sheets.

For the just-completed quarter, net orders for new homes were off 6 percent to 3,907. Prospective buyers canceled their contracts at a rate of 50 percent higher than the prior quarter's 34 percent and reflecting the troubles in the mortgage market, KB said.

KB Home shares were down 13 cents to $23.96 in early trading on the New York Stock Exchange.

Year to date, KB shares are off 53 percent, in line with the benchmark Dow Jones U.S. Home Construction Index<.DJUSHB>.

(Reporting by Ilaina Jonas)

[fraga]

Couldn't that be said of all homebuilders due to the exploding bubble in Florida, California, etc...

[Mijo]

Couldn't that be said of all homebuilders due to the exploding bubble in Florida, California, etc... I would think so. I work in the indusrty as well and KB isn't the only feeling the heat.

[Spurs>All]

KB = Krap Built

[boutons_]

September 27, 2007

New Home Sales and Prices Off Sharply in August

By MICHAEL M. GRYNBAUM

New home sales in August plunged to their lowest rate in over seven years, as tighter credit and rising inventories continued to cripple a national housing industry that was booming only a year ago.

Purchases of new homes fell to an annual rate of 795,000, an 8.3 percent decline from July, as inventory levels rose to their highest level since March, the Commerce Department said this morning. The median price for a new home was down 7.5 percent from a year ago, to $225,700, marking the steepest monthly price drop since December 1970.

The sales figures were released as KB Home, a major home builder, reported a $35.6 million loss in the third quarter, or 46 cents a share, compared to net profits of $153.2 million a year earlier. KB Home, based in Los Angeles, had a 32 percent drop in revenue from the same period last year.

KB was forced to write down almost $800 million in inventory and goodwill value after the subprime mortgage crisis caused turmoil in the credit market and high rates of foreclosure. Those losses outpaced the company’s gains from selling its 49 percent stake in a French subsidiary. The company’s stock was up 0.54 percent, to $24.22, in early trading.

The latest data gave a fuller picture of the distress in the housing sector. This morning’s news comes on the heels of a 4.3 percent drop in existing home sales and a dismal third-quarter report from Lennar, another large home builder, which recorded the largest quarterly loss in its history. The rate of new home sales is now down over 21 percent from a year ago.

“Our third-quarter results reflect the seriously challenging market conditions that prevail for home builders across most of the nation,” KB’s chief executive, Jeffrey T. Mezger, said in a statement. “At this time, we see no signs that the housing market is stabilizing and believe it will be some time before a recovery begins.”

Analysts concurred, predicting that the disappointing numbers were only the start of a continued decline in the housing sector that could last several quarters.

“Anybody that’s expecting a turnaround in housing anytime soon is going to be disappointed,” said Mike Schenk, a senior economist at the Credit Union National Association. “It’s going to be a long, slow process.”

In a spot of sunlight for the economy, the number of new unemployment claims filed last week dipped to 298,000, its lowest level since early May. The figure, a 15,000 decrease from the week ended Sept. 14, beat analysts’ expectations, though some analysts warned against extrapolating a trend from a single week’s data.

The gross domestic product rose 3.8 percent in the second quarter, the Commerce Department said this morning, a downward revision from its previous estimate of 4.0 percent. Exports and consumer spending drove the increase, the government said, though the growth occurred before the summer’s subprime crisis. The gross domestic product, which measures nationwide economic activity, increased 0.6 percent in the first quarter.

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If you can qualify for financing, there should be some good deals around. And for people who can't qualify, the rental/apt market should heat up.