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Contracts for custom-made houses fell in November

JIJI

Major home builders saw the value of newly concluded contracts for custom-made houses slump year on year in November.

Sekisui House Ltd. posted a drop of 32 percent, Sumitomo Forestry Co. 28 percent, Daiwa House Industry Co. some 20 percent and Asahi Kasei Homes Corp. 13 percent. Asahi Kasei Homes’ figure includes contracts to build houses for rent.

The number of new contracts has been falling since soaring in September thanks to strong demand ahead of the consumption tax hike to 8 percent next April. The current 5 percent tax will continue to apply to houses built after the tax hike if their construction contracts were concluded by the end of September.

For Sekisui House, the drop in November was “bigger than expected,” an official said. Daiwa House characterized the dismal result as a knee-jerk reaction to the September spurt.

The number of people visiting display homes, a leading indicator for house construction orders, shot up by 10 percent at Asahi Kasei. Sekisui House saw the number recover close to year-before levels thanks to an increase in the Tokyo area.

Misawa Homes Co. also announced custom-made house contract data for November after disclosing on Nov. 15 there were possible flaws in construction work on more than 1,600 of its houses in nine prefectures.

The value of its newly concluded contracts fell 22 percent in November from a year earlier.