Fitch Ratings, New York, reviewed the ratings of 12 homebuilders and downgraded eight, while affirming four.

Among those builders with their ratings cut are: Ryland Group, M.D.C. Holdings, Toll Brothers, Centex Corp., M/I Homes, Lennar Corp., KB Homes and D.R. Horton. The rating agency said,

"The downgrade reflects the current very difficult housing environment and Fitch expectations that housing activity will be even more challenging than previously anticipated throughout calendar 2009.

The recessionary economy and impaired mortgage markets are, of course, contributing to the housing shortfall."

As for the future course of ratings actions, Fitch said those would be "influenced by broad housing market trends as well as company specific activity, such as land and development spending, general inventory levels, speculative inventory activity (including the impact of high cancellation rates on such activity), gross and net new order activity, debt levels and free cash flow trends and uses."


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