by Calculated Risk on 2/28/2006 12:39:00 AM

Standard Pacific reported declining year over year New Home Orders Through February 26.

New home orders companywide for the year-to-date period ended February 26, 2006, excluding joint ventures, were down 13% from the level achieved a year ago. The overall decline in orders resulted from the slowing of demand in some of our markets from the unsustainable pace of the past few years, a trend that we began to experience in the fourth quarter of last year. This slowing of sales activity is particularly evident in markets which have experienced significant price increases and investor-driven demand in recent years, such as California and Florida.

New home orders were down 24% year over year in Southern California on a 29% increase in active selling communities. The lower level of sales activity in Southern California was due to: (1) a softening in buyer demand, most notably in San Diego and, to a lesser degree, in Orange County, (2) reduced product availability, particularly in our Los Angeles division, and (3) an increase in the cancellation rate. New orders were up, however, year over year in the Inland Empire, our largest and most affordable division in the region.

In Northern California, new home sales were down 60% on a 12% lower active community count. The year-over-year decrease in new home orders during the period reflected a slowdown in order activity which began in the latter half of 2005 from the robust pace experienced in 2004 and the first half of 2005, combined with a reduction in the number of active selling communities. The decrease in community count is particularly pronounced in our South Bay division where we experienced rapid sellouts in 2004 and 2005, and where a number of our new projects are targeted for 2006. While the Company saw a noticeable slowing of demand in Sacramento in the second half of 2005, orders for the year-to-date period ended February 26, 2006 were up slightly compared to the year earlier period.

New home orders were down 37% in Florida on a 12% decrease in community count. A number of factors contributed to the year-over-year decrease in Florida order activity: (1) reduced product availability in certain divisions, particularly in Orlando and Jacksonville, (2) a softening in buyer demand, most notably in South Florida and Southwest Florida, (3) continued intentional slowing of orders to better align production and sales, particularly in Tampa, and (4) a modest increase in the cancellation rate. The Company has 73% of its 2006 targeted deliveries for the state in its backlog or closed as of February 26, 2006.
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The Company's cancellation rate for the year-to-date period ended February 26, 2006 was 26%, up from the year earlier rate of 18%.