Toll Brothers Chairman Unloads Shares

WASHINGTON ( TheStreet) -- Toll Brothers' ( TOL) executive chairman Robert I. Toll has been divesting his stake in his namesake company.

The homebuilder 's executive chairman and former CEO sold 500,000 shares, according to a Jan. 11 filing with the Securities and Exchange Commission.

The shares sold for $20.47 each for a total value of $10.2 million, diluting Toll's stake in the company to 14.1 million shares. As of a Dec. 6 filing, Toll held 14.9 million shares, or 8.92%, of Toll Brothers.

Toll Brothers shares were 0.2% higher at $20.37 Wednesday afternoon.

Toll Brothers surprised investors with a return to year-over-year profitability in its fiscal fourth quarter, and recently said deposits jumped 10% in the second half of November compared with year-earlier results.

Elsewhere in the sector, Lennar ( LEN), which posted better-than-expected fiscal-fourth quarter earnings on Tuesday, said new-home deliveries were down 12% in its recent quarter to 3,089. Orders for new homes fell 5% to 2,520.

KB Home ( KBH), which posted a surprise quarterly profit on Friday, said fewer homes delivered in its recent quarter was partially offset by an increase in the average selling price.

Small-cap builder Hovnanian Enterprises ( HOV) sold 13% fewer homes in its fiscal fourth quarter, while completed sales fell almost 17% year-over-year, despite narrowing its net losses.

Lennar shares were 0.8% higher Wednesday at $20.40, KB Home added 2% to $15.08 and Hovnanian rose 2.2% to $4.62.

Homebuilder stocks were mostly higher in the session after the Mortgage Bankers Association reported that mortgage application volume increased 2.2% last week as mortgage rates edged lower.

Rising mortgage rates, which some market watchers view as deterring home buying activity, are not likely to rise as they had in recent week, but are also unlikely to return to record lows seen in recent months, Paul Anastos, president of Mass.-based Mortgage Master, told TheStreet recently.

The average rate on a 30-year fixed mortgage fell to to 4.78%, from 4.82% in the prior week. It was the second consecutive week of declines in the 30-year fixed rate and remains 15 basis points below the survey's seven-month high observed two weeks ago. Still, mortgage rates remain near all-time lows.

The road to a sustainable housing recovery is long, Anastos said. November's pace of existing-home sales remained 27.9% below those of Nov. 2009 , which was the initial deadline for the first-time buyer tax credit .

Disappointing November homebuilding permits data further confirms that the "housing market recovery remains fragile at best," Kevin Brungardt, CEO of RoundPoint Financial, a mortgage origination and servicing firm, told the TheStreet last month. Existing-home sales rose 5.6% in November while new-home sales increased 5.5% in the month.

-- Written by Miriam Marcus Reimer in New York.

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