Centex Cuts Prices for New Homes
CNBC reports that Centex Homes, www.centexhomes.com, one of the nations largest home builders, announced it’s plans to discount the prices of its new homes by 5%. In addition, Centex will waive their 1% loan origination fee for mortgage applicants.
The discount of 5% would translate into an average price reduction of $15,000, depending on the original price of the home. The added savings of 1% on the mortgage will equate to additional $2000 savings for the average buyer.
The Centex decision to cut prices is the first acknowledgement by a major home builder that the market is slowing. While we do not know yet exactly which markets Centex intends to discount, the announcement led this viewer to believe the program would be fairly broad based.
Dallas based Centex (NYSE: CTX), builds 33,000 homes per year, in 25 states. Its leading brands include Centex Homes, Fox & Jacobs Homes and Centex Destination Properties. In addition to its home building operations, Centex’s related business lines include mortgage and financial services, home services and commercial construction. Centex ranked No. 1 in its industry on Fortune Magazines 2005 list of “America’s Most Admired Companies.”