US homebuilder reports $773m loss

KB Home expects 2008 to be as tough as last year

KB Home, the fifth largest US homebuilder, has made quarterly loss of $773m (£392m) as the American housing market slowdown continues to bite.

Reporting for the last three months of 2007, KB Home said it had written off $305.5m because of the reduced value of its housing and land stocks.

The Los Angeles-based firm said its sales fell 22% in the quarter compared with the same time last year.

KB Home, which saw revenues fall 31%, said it also expected a tough 2008.

Record defaults

The company's fourth quarter revenues totalled $2.07bn, compared with $3.01bn for the same period in 2006.

Its $773m loss compares with a $49.6m loss a year earlier.

Government figures released at the end of December showed that sales of US homes fell to a 12-year low in November.

The US housing market has crashed over the past year in the face of higher mortgage rates, which have led to record mortgage default levels, particularly in the sub-prime sector.

The result has been falling house prices, and growing numbers of Americans either unwilling or unable to join the housing market.