William Lyon Homes Reports Fourth Quarter and Annual Closings, Orders and Backlog

NEWPORT BEACH, Calif., Jan 3, 2005 (BUSINESS WIRE) -- William Lyon Homes (WLS) announced today preliminary closings, net new home orders and backlog information for the three and twelve months ended December 31, 2004.

The number of homes closed for the twelve months ended December 31, 2004 was 3,471, a record for any year in the Company's history, and an increase of 24% as compared to 2,804 for the twelve months ended December 31, 2003.
The number of homes closed for the three months ended December 31, 2004 was 1,210, a decrease of 6% as compared to 1,290 for the three months ended December 31, 2003.

Net new home orders for the three months ended December 31, 2004 were 493, a decrease of 35% as compared to a record 761 for the three months ended December 31, 2003.

Net new home orders for the twelve months ended December 31, 2004 were 3,371, a decrease of 2% as compared to a record 3,443 for the twelve months ended December 31, 2003.

Based on record first and second quarter 2004 net new home orders of 2,219, an increase of 30% as compared to the same period in 2003, as previously announced the Company had anticipated a significant reduction in net new home orders for the third and fourth quarters of 2004 when compared to the same period in 2003. The reduction in order activity for the six months ended December 31, 2004 primarily reflects a lack of available product for sale due to stronger than anticipated absorption levels in the previous periods, a decrease in the average number of sales locations, and slower sales in certain of the Company's markets.

The Company's backlog of homes sold but not closed was 1,166 at December 31, 2004, a decrease of 8% as compared to 1,266 at December 31, 2003.

 Three Months   Twelve Months
                                             Ended           Ended
                                          December 31,    December 31,
                                           2004   2003    2004   2003
Number of net new home orders:
   California                               330    539   2,112  2,357
   Arizona                                  100     78     677    389
   Nevada                                    63    144     582    697
                                            493    761   3,371  3,443

Average number of sales locations
 during period:
   California                                24     33      28     28
   Arizona                                    6      5       6      6
   Nevada                                     7      6       7      6
                                             37     44      41     40

Number of homes closed:
   California                               850    958   2,336  1,926
   Arizona                                  136    101     402    319
   Nevada                                   224    231     733    559
                                          1,210  1,290   3,471  2,804

Backlog of homes sold but not closed at
 end of period:
   California                               602    826
   Arizona                                  482    207
   Nevada                                    82    233
                                          1,166  1,266

The Company's net new home orders for the three months ended December 31, 2004 include 147 homes from joint venture communities, compared to 189 homes from joint venture communities in the three months ended December 31, 2003.

The Company's cancellation rate for the three months ended December 31, 2004 was 29% as compared to 20% for the three months ended December 31, 2003. The Company's cancellation rate for the twelve months ended December 31, 2004 was 17% as compared to 18% for the twelve months ended December 31, 2003.

William Lyon Homes is primarily engaged in the design, construction and sale of single family detached and attached homes in California, Arizona and Nevada and at December 31, 2004 had 37 active sales locations. The Company's corporate headquarters are located in Newport Beach, California. For more information about the Company and its new home developments, please visit the Company's website at www.lyonhomes.com.

Certain statements contained in this release that are not historical information contain forward-looking statements. The forward-looking statements involve risks and uncertainties and actual results may differ materially from those projected or implied. Further, certain forward-looking statements are based on assumptions regarding future events which may not prove to be accurate. Factors that may impact such forward-looking statements include, among others, changes in general economic conditions and in the markets in which the Company competes, the outbreak, continuation or escalation of war or other hostilities, including terrorism, involving the United States, changes in mortgage and other interest rates, changes in prices of homebuilding materials, weather, the occurrence of events such as landslides, soil subsidence and earthquakes that are uninsurable, not economically insurable or not subject to effective indemnification agreements, the availability of labor and homebuilding materials, changes in governmental laws and regulations, the timing of receipt of regulatory approvals and the opening of projects, and the availability and cost of land for future development, as well as the other factors discussed in the Company's reports filed with the Securities and Exchange Commission.

SOURCE: William Lyon Homes

William Lyon Homes
W. Douglass Harris (Investors), 949-833-3600

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