Dominion Homes Posts 54% Drop
In Home Sales for First Quarter

Dominion Homes Inc. became the latest home builder to feel the sting of the U.S. housing slump, reporting a 54% drop in homes sold during the first quarter.

The Dublin, Ohio, company sold 218 homes in the first quarter, for a total sales value of $43.5 million, down from 475 homes, or $89.3 million, a year earlier.

The company, the most recent home builder to report lower sales of new homes, noted that this was its best sales performance since the second quarter of 2006. The housing sector has been struggling with an inventory glut, a surge in cancellations from jittery buyers and a slump in demand, forcing most home builders to slash prices and offer other incentives to spur sales.

Sales in the industry have also been hurt by the meltdown in the subprime-mortgage lending sector.

Dominion Homes delivered 48% fewer homes during the quarter, for a total of 165 homes. The backlog as of March 31 was 319 contracts, with a sales value of $64.9 million, compared with 590 contracts, with a sales value of $118.2 million, a year ago.

Earlier this year, the company completed a four-year renewal of its credit facility to help "weather an anticipated loss in 2007 as a result of the depressed housing market, and to respond aggressively when the market rebounds."

Last month, KB Home, one of the nation's largest home builders, posted an 84% drop in fiscal first-quarter earnings as orders and prices for new homes dropped. Toll Brothers Inc., the closely watched luxury-home builder, reported a 67% drop in fiscal first-quarter profit and offered little hope the overall housing market is improving.

Dominion Homes will release full first-quarter results on May 4.

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