Owens Corning to sell masonry division
Owens Corning has signed an agreement to sell its masonry division, which makes Owens Corning Cultured Stone exterior siding, to Boral Industries in a two-part transaction, the company announced.
The building products supplier will sell a 50% stake in its masonry products unit to Boral Industries for $45 million at closing, and the unit will then be operated jointly until early 2014. At that time, Owens Corning will sell its remaining 50% stake for $45 million and may receive additional proceeds dependent upon 2013 financial performance.
The transaction is expected to close by year-end and is subject to regulatory approval.
Based in Toledo, Ohio, Owens Corning is a maker of insulation, roofing, windows and manufactured stone siding. Boral is based in Australia. The company’s U.S. division makes bricks, roof tiles and other construction products.
California home sales rise in November
Sales of existing, single-family homes in California rose 9.2% in November, compared with the previous month, although overall sales were down from November 2009.
These statewide statistics, collected by the California Association of Realtors, also showed a median price decline from both the previous month and the previous year. The median price of an existing, single-family detached home sold in California fell below the $300,000 mark for the first time since February. The November 2010 median price was $296,820, down 2.4% from October’s $304,220 median price and down 2.5% from the $304,550 median price recorded for the same period a year ago. It was the first year-over-year price decline in a year.
The report coincided with the National Association of Realtors’ release of national figures showing a 5.6% increase in existing-home sales for November.
In California, there is a mixed picture. “We are encouraged by November’s sales increase, but realize a more sustained recovery is being hampered by the distressed market,” said Beth Peerce, the association’s president. “While we are experiencing a greater share of short sales, these transactions are notoriously difficult to navigate with no guarantee of closure.” A recent survey conducted by the realtors’ association found that lenders typically take 90 days or more to communicate whether a short has been accepted, causing frustration for buyers and sellers.
“Moreover, the survey found that more than two out of five short sale transactions never close,” Peerce said. “The housing market can’t fully recover until lenders streamline and improve the short sales process, which would help expedite transactions.”
The survey also found that the unsold inventory of existing, single-family detached homes was 6.2 months in November, down from 6.5 months in October. This compares with 4.5 months in November 2009. The unsold inventory index indicates the number of months needed to deplete the supply of homes on the market at the current sales rate.
Existing-home sales show improvement
Data released today from the National Association of Realtors (NAR) show sales of existing homes increased 5.6% to a pace of 4.68 million in November.
The seasonally adjusted annual rate of 4.68 million is the highest since June 2010, which saw a pace of 5.26 million. Compared with November of last year, however, sales are 27.9% down from a 6.49-million pace.
A month ago, officials from the NAR talked about an "uneven recovery" and optimistic projections of sales at the 5-million pace by spring of 2011. That optimistic analysis continued with the release of this morning’s figures. Lawrence Yun, NAR chief economist said: “Continuing gains in home sales are encouraging, and the positive impact of steady job creation will more than trump some negative impact from a modest rise in mortgage interest rates, which remain historically favorable."
The national median existing-home price for all housing types was $170,600 in November, up 0.4% from November 2009. Distressed homes have been a fairly stable market share, accounting for 33% of sales in November; they were 34% in October and 33% in November 2009.
Today’s figures were in line with analyst expectations.
Yun added that home buyers are responding to improved affordability conditions. “The relationship recently between mortgage interest rates, home prices and family income has been the most favorable on record for buying a home since we started measuring in 1970,” he said. “Therefore, the market is recovering and we should trend up to a healthy, sustainable level in 2011.”