by Calculated Risk on 10/11/2007 09:23:00 PM

From the WSJ: Beazer Homes Reports Surge In Cancellations of Orders

Beazer reported that 68% of its prospective home buyers canceled their orders in the company's fiscal fourth quarter, which ended Sept. 30. The cancellation rate was almost double the 36% of customers who canceled orders and gave up deposits in the prior quarter.

Beazer is one of the first large builders to detail results from September ...

With rising cancellation rates, the monthly New Home sales number from the Census Bureau is probably too high, and their estimate of the increase in inventory is too low. My current estimate is the Census Bureau underestimated new home inventory by 77K at the end of Q2, based on cancellations rates at several of the largest public homebuilders. Cancellations rates climbed again in Q3 because of tighter lending requirements (68% cancellations is probably the high end because of special problems at Beazer).