Homebuilder MDC Holdings Inc. says it introduced smaller, more affordable homes during the first quarter of 2009 to attract more first-time buyers and improve the efficiency of the construction process.
The Denver-based company, which builds under the name Richmond American Homes, also is integrating its design center into its marketing approach, MDC chairman and chief executive Larry Mizel said during its quarterly conference call Friday.
The company is implementing what it’s calling a “drywall hold” strategy.
“We will bring the product to market but allow the homebuyer to come to the design center to customize what they want versus what has been delivered to them in the past,” Mizel said. “We can build it quicker and . . . cheaper.”
MDC reported its first-quarter loss narrowed as it wrote off fewer assets and cut costs, and revenue fell by more than half amid the continued housing market decline.
MDC lost $40.9 million, or 88 cents per share, in the period ended March 31, down from $72.8 million, or $1.58 per share, last year. Revenue fell 56 percent to $175.9 million from $395.8 million last year.
Home closings fell 49 percent, with the biggest decreases in Arizona, California and Nevada. The average selling price during the quarter was down 8 percent. Net orders fell 38 percent to 676 homes, from 1,098 last year.
The homebuilder shed the number of lots it owns by 35 percent to 8,542, the lowest level in a decade.
Mizel said MDC is considering participating in the federal Public-Private Investment Program (PPIP), which is focused on residential and commercial real estate. The PPIP is designed to help banks get rid of loans that hurt operations and capital. It also provides guarantees and some leverage to private investors to buy the loans.
Margaret Jackson: 303-954-1473 or mjackson@denverpost.com
