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Ryland Group Inc.'s (RYL) fourth-quarter net loss narrowed as the company posted fewer adjustment and impairment charges, but revenue and new orders tumbled as the housing market continued to slump amid the recession.

The home builder and mortgage-finance company reported a net loss of $59.9 million, or $1.40 a share, compared with a year-ago loss of $201.9 million, or $4.80 a share.

The latest results included inventory and other valuation adjustments, including goodwill and joint venture impairments of $55.1 million. The prior year's quarter had inventory valuation adjustments and write-offs of $242.7 million and an income tax charge of $75.2 million.

Revenue tumbled 39% to $528.2 million. Analysts polled by Thomson Reuters projected a per-share loss of $1.06, excluding items, on revenue of $540 million.

Gross margin fell to 10.2%, excluding items, from 14%, while the average home price dropped 8.6% to $246,000. New orders dropped 65% to 554 units, and closings slid 36% to 1,964.

The inventory of unsold homes fell 22% to 639 units on Dec. 30 from 823 units a year ago.

In the financial-services segment, the company posted a 35% decline in the number of mortgages originated and a 6.2% decrease in average loan size.

Home builders have lobbied Congress to expand on a $7,500 temporary tax credit for first-time home buyers, making it available to all home buyers and eliminating a requirement to pay the credit back over time. Builders have slashed prices, added upgrades and even vacations to lure buyers, but the market hasn't showed signs of a turnaround.

Last week, Toll Brothers Inc. (TOL) surprised the industry when it lowered the rate of its 30-year, fixed-rate mortgage to 3.99% on some of its loans, a move that may lead to similar moves by other builders as the housing market worsens. Lennar Corp. (LEN) and Hovnanian Enterprises Inc. (HOV) are also offering interest rates well below the national average. Shares of Ryland were flat in after-hours trading at $16.50. Builders' shares have tumbled the past several years as the sector battles the worst downturn in decades.

-By John Kell, Dow Jones Newswires; 201-938-5285; john.kell@dowjones.com

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