Workers build a home in Rancho Santa Fe. (Sam Hodgson / Bloomberg )
Los Angeles homebuilder KB Home, one of the largest production homebuilders in Southern California, narrowed its loss to $12.5 million in the first quarter as the outlook for new construction improved.
While still in the red, that loss was an improvement over the company’s loss of $45.8 million a year prior. The company said that its revenues increased 59% over the year, to $405.2 million, and that the company sold 29% more properties with 1,485 homes sold.
Chief executive Jeffrey T. Mezger said the company should see some profits this year.
MAP: Southern California's housing recovery: An interactive look
“Based on the strategic steps we have taken, our improved performance over the past year and the accelerating momentum we are seeing in our business, we are confident that we will achieve our profitability goal for 2013,” he said in a statement.
The average selling price of the company’s homes increased 24%, to $271,300. Many builders have been able to raise prices over the last year as the market for new homes has begun to heat up.
Extremely tight inventory has helped raise home prices as buyers battle over few available homes. That's made new construction more attractive.
But the National Assn. of Home Builders said this week that the demand for new housing is outstripping builders' ability to deliver new homes as they deal with rising labor and material costs and a lack of ready-to-build lots.
Job growth accelerates as housing market strengthens
Rising housing prices are driving down affordability in California
Trade group: Housing demand exceeds builders' ability to deliver