Market Overview

This Is What Lennar's CEO Had To Say On The U.S. Housing Recovery


While the housing sector has recovered from the post-financial crisis meltdown, it is yet to reach levels seen before the financial crisis. The U.S. housing recovery has been consistent, albeit slow. Stuart Miller, CEO of Lennar Corporation (NYSE: LEN), was recently on CNBC to discuss what is keeping housing recovery in check.

"This recovery has been very slow, very steady, a low slope," Miller said. "It is governed by production deficit at the bottom, but mortgage finance impairment at the top. We can’t get mortgages approved and that's really governing demand. So, it's keeping the range of the improvement of the market really constrained into a narrow band."

""The statement that I made in our third quarter is exactly that statement: a million housing starts a year used to define depression and in this recovery, we're just getting back to that million start level."

When asked regarding who's at fault for the slow pace of housing recovery, Miller said, "Look, at the end of the day we went through a treacherous downturn. It was defined by mortgage excess and the mortgage market has reconstituted itself in a very limiting way: high down payments, a very tight credit box and a regulatory overlay that really has the banks re-thinking whether they even want to be involved in the mortgage business. So you hear about the banking overlay on what Fanny, Freddie, FHA/VA have as their standards and it really is a limiting factor."

Shares of Lennar recently traded at $47.55, up 0.55 percent.

Posted-In: CNBC stuart millerMedia


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