| | |  Puerto Vallarta Real Estate | October 2008 
Homex Eases Land Buys as Credit Crisis Threatens
 Cyntia Barrera Diaz - Reuters
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Mexico City - Mexican homebuilder Homex will pull out from the high-end residential market and reduce land acquisitions through the end of 2009, focusing on cheap houses to better weather the financial crisis.
In a move to save money and allocate resources to the most profitable market segment - cheap homes selling for under $50,000 - Homex (HOMEX.MX) (HXM.N) will put off further projects in the luxury market, although it will continue with its developments in the beach destinations of Los Cabos, Puerto Vallarta and Cancun.
"We have a land bank close to five years of future sales," Chief Executive Gerardo de Nicolas said during a conference call with analysts. "Due to the actual macro conditions ... that's why we are significantly reducing our land acquisition for the next five quarters."
De Nicolas said smaller competitors were starting to suffer from liquidity problems as bank and government-funded mortgages dry up.
"This is a unique opportunity for us to gain market share ... and consolidate business in the cities where we already have a presence," de Nicolas said. "The Mexican housing market is already witnessing some signs of deceleration."
Homex, headquartered in the northern city of Culiacan, reported on Tuesday a 38 percent slump in third-quarter net profit, hit by a stiff foreign exchange loss, although its revenue rose 17 percent.
Homex shares gained 8.64 percent Wednesday to 43.87 pesos.
(Editing by Tim Dobbyn) |
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