* Lennar earnings $0.54 per share vs est $0.45
* Lennar orders jump 14 pct to 4,785 houses
* KB Home third-quarter earnings $0.30 vs est $0.21
* Lennar shares up 6 pct; KB Home shares rise 7 pct
By Bijoy Anandoth Koyitty
Sept 24 (Reuters) - Lennar Corp and KB Home posted strong quarterly earnings as scarcity of new homes keptthe U.S. housing recovery firmly on track.
U.S. homebuilders have been under pressure since May wheninterest rates started rising on fears that the Federal Reservewould taper bond purchases, but the sector got a short-termrelief last week when the Fed extended its monetary stimulus.
Lennar shares rose 5.5 percent to $36.46 in afternoon tradeon the New York Stock Exchange. Shares of KB Home were up 7percent at $18.30.
Lennar Chief Executive Stuart Miller said that although theyear has witnessed significant building activity, supply wouldstill fall short of demand by a wide margin.
"Builders ... have been pushing to increase production asinventories of rentals, existing homes, and new homes, haveremained extremely low and pricing for all of these productshave been moving up," Miller said on a post-earnings call.
Lennar, the No. 3 U.S. homebuilder, said orders for newhomes rose 14 percent in the third quarter, compared to a 27percent increase in the second quarter.
Wall Street Strategies analyst David Urani said "14 percentis still pretty good," considering the mortgage rate impact.
"Interest rates are more of a near-term thing and sort of aspeed bump. If you are going to abandon homebuilders because ofthat, then you are taking too much of a short-term outlook,"Urani said.
U.S. housing starts rose less than expected in August amid asharp slowdown in the multifamily sector, but a surge in permitsfor single-family homes pointed to sustained strengthening inthe housing market recovery.
Homebuilders are also getting aggressive on landacquisitions as a dearth of developed land constrain theirability to cater to rising demand.
Miami-based Lennar is better positioned than most tocontinue building houses as it got back into the game earlyfollowing the housing crisis and has actively bought land overthe past several years.
Miller said on the call that Lennar's land bank would helpthe company meet its projected deliveries through 2014 and muchof 2015.
"As a result, we are pursuing land opportunities for 2015and beyond," he said.
ORDERS, BACKLOG JUMP
Orders, a key indicator for builders who do not book revenueon a house until the sale is complete, jumped to 4,785 houses inthe third quarter, Lennar said.
Lennar's backlog - houses ordered but not yet finished -rose 32 percent to 5,958 in units and 53 percent to $1.9 billionin value.
KB Home said its net orders rose 7 percent to $528.9 million from a year earlier, in terms of value.
Lennar posted net income of $120.7 million, or 54 cents pershare, in the third quarter from $87.1 million, or 40 cents pershare, a year earlier.
This beat analysts' average expectations of 45 cents pershare on revenue of $1.56 billion, according to Thomson ReutersI/B/E/S.
KB Home reported quarterly earnings of 30 cents per share,above analysts' average expectations of 21 cents per share.
The strong results from Lennar and KB Home also drove a 4percent rise in the Dow Jones Home Construction index.
- Real Estate
- KB Home