HOVNANIAN ENTERPRISES, INC. News Release

Contact: Kevin C. Hake Jeffrey T. O’Keefe

Senior Vice President, Finance and Treasurer Director of Investor Relations

732-747-7800 732-747-7800

HOVNANIAN ENTERPRISES REPORTS FIRST QUARTER FISCAL 2008 RESULTS

RED BANK, NJ, March 10, 2008 – Hovnanian Enterprises, Inc. (NYSE: HOV), a leading national homebuilder, reported results for its first quarter ended January 31, 2008.

REVOLVING CREDIT FACILITY UPDATE

• The Company closed an amendment for its revolving credit facility. The maturity of the credit facility remains May 2011.

• In return for a meaningfully less restrictive covenant package, the amendment reduces the maximum commitment amount of the facility to $900 million and secures outstanding amounts with liens on a portion of the Company’s assets.

RESULTS FOR THE 3 MONTHS ENDED JANUARY 31, 2008:

• Excluding unconsolidated joint ventures, the Company delivered 3,604 homes, including 1,345 homes from the Company’s Fort Myers-Cape Coral operations, with an aggregate sales value of $1.05 billion in the first quarter of fiscal 2008, an increase of 10.3% from 3,266 home deliveries with an aggregate sales value of $1.14 billion in the fiscal 2007 first quarter. Total revenues were $1.09 billion for the first quarter of fiscal 2008.

• Excluding land-related charges, the Company reported a pre-tax loss of $75 million for the first three months of fiscal 2008. Including all land-related charges, the Company reported a pre-tax loss of $169 million for the first quarter of fiscal 2008.

• During the first quarter of fiscal 2008, the Company incurred a total of $94 million of pre-tax land-related charges including land impairments of $74 million and write-offs of predevelopment costs and land deposits of $16 million, as well as $4 million representing its equity portion of write-offs and impairment charges in unconsolidated joint ventures. Similar charges, including intangible impairments, in the first quarter of fiscal 2007 totaled $93 million.

• Reported an after tax loss, including the effect of a $21 million FAS 109 deferred tax valuation allowance charge, of $131 million or $2.07 per common share for the first three

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months of fiscal 2008, compared with a net loss of $57 million, or $0.91 per common share, in the first quarter of fiscal 2007.

BALANCE SHEET AS OF JANUARY 31, 2008:

• The Company ended the first quarter of fiscal 2008 with $1.2 billion in total stockholders’ equity or $16.79 per common share.

• At January 31, 2008, the Company had $73 million of homebuilding cash and the balance on the Company’s revolving credit facility was $325 million.

• The Company’s net recourse debt to capital ratio at January 31, 2008 was 64.6%. The Company’s FAS 109 deferred tax valuation allowance charges for the last two quarters were $237 million. Prior to the effect of these charges, the Company’s net recourse debt to capital ratio at quarter-end was 60.3%.

• Total land position decreased by 5,683 lots compared to October 31, 2007, reflecting owned and optioned position decreases of 1,308 lots and 4,375 lots, respectively, over the same time period. As of January 31, 2008, the Company had 31,729 lots controlled under option contracts and owned 27,372 lots. The total land position of 59,101 lots represents a 51% decline from the peak total land position at April 30, 2006.

• Achieved a 17.8% decline in unsold homes and models, from 2,822 at October 31, 2007 to 2,321 at January 31, 2008. Excluding model homes, the Company had 1,898 started unsold homes as of January 31, 2008.

OTHER KEY OPERATING DATA:

• Homebuilding gross margin, before interest expense included in cost of sales, was 6.7% in the 2008 first quarter, compared with 18.0% in the first quarter of 2007. Gross margins were adversely impacted by the 1,345 deliveries from our Fort Myers-Cape Coral operations which generated only a 2.0% gross margin. At the end of the quarter, backlog in Fort Myers-Cape Coral was only 306 homes with a sales value of $84 million.

• Pretax income from Financial Services in the first quarter of fiscal 2008 was $3.1 million.

• The Company had 404 active selling communities on January 31, 2008, excluding unconsolidated joint ventures, a decline of 27 active communities, or 6.3%, from the end of the fourth quarter on October 31, 2007. The Company had 436 active selling communities on January 31, 2007, excluding unconsolidated joint ventures.

• During the first quarter of fiscal 2008, the Company delivered 155 homes through unconsolidated joint ventures, compared with 289 homes in last year’s first quarter.

• The number of net contracts for the first quarter of fiscal 2008, excluding unconsolidated joint ventures, declined 41.2% to 1,511 contracts.

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• The Company’s contract cancellation rate, excluding unconsolidated joint ventures, for the first quarter of fiscal 2008 was 38%, compared with the rate of 40% reported in the fourth quarter of 2007 and the rate of 36% in the first quarter of fiscal 2007.

• Contract backlog as of January 31, 2008, excluding unconsolidated joint ventures, was 3,845 homes with a sales value of $1.3 billion, down 49.8% compared to contract backlog with a sales value of $2.7 billion at the end of last year’s first quarter.

PROJECTIONS FOR FISCAL 2008:

• The Company continues to project positive cash flow from operations in excess of $100 million for fiscal 2008.

COMMENTS FROM MANAGEMENT:

“Market conditions remain challenging across many of our markets,” commented Ara K. Hovnanian, President and Chief Executive Officer of the Company. “We continue to focus on reducing our inventories, maximizing cash flow and shrinking our overhead to ensure that we properly manage the difficult market conditions we currently face. Despite the persistence of negative factors impacting the homebuilding industry, we are diligently working to position the company to take advantage of the stronger demand for new homes that will inevitably return once the current housing correction ends,” concluded Mr. Hovnanian.

Hovnanian Enterprises will webcast its fiscal 2008 first quarter financial results conference call at 11:00 a.m. E.T. on Tuesday, March 11, 2008. The webcast can be accessed live through the “Investor Relations” section of Hovnanian Enterprises’ Web site at http://www.khov.com. For those who are not available to listen to the live webcast, an archive of the broadcast will be available under the “Audio Archives” section of the Investor Relations page on the Hovnanian Web site at http://www.khov.com. The archive will be available for 12 months.

ABOUT HOVNANIAN ENTERPRISES:

Hovnanian Enterprises, Inc., founded in 1959 by Kevork S. Hovnanian, Chairman, is headquartered in Red Bank, New Jersey. The Company is one of the nation’s largest homebuilders with operations in Arizona, California, Delaware, Florida, Georgia, Illinois, Kentucky, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. The Company’s homes are marketed and sold under the trade names K. Hovnanian Homes, Matzel & Mumford, Forecast Homes, Parkside Homes, Brighton Homes, Parkwood Builders, Windward Homes, Cambridge Homes, Town & Country Homes, Oster Homes, First Home Builders of Florida and CraftBuilt Homes. As the developer of K. Hovnanian’s Four Seasons communities, the Company is also one of the nation’s largest builders of active adult homes.

Additional information on Hovnanian Enterprises, Inc., including a summary investment profile and the Company’s 2007 annual report, can be accessed through the “Investor

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Relations” section of Hovnanian Enterprises’ website at http://www.khov.com. To be added to Hovnanian’s investor e-mail or fax lists, please send an e-mail to IR@khov.com or sign up at http://www.khov.com.

Hovnanian Enterprises, Inc. is a member of the Public Home Builders Council of America (“PHBCA”) (http://www.phbca.org), a nonprofit group devoted to improving understanding of the business practices of America’s largest publicly-traded home building companies, the competitive advantages they bring to the home building market, and their commitment to creating value for their home buyers and stockholders. The PHBCA’s 14 member companies build one out of every five homes in the United States.

NON-GAAP FINANCIAL MEASURES:

Consolidated earnings before interest expense, income taxes, depreciation and amortization (“EBITDA”) and before inventory impairment loss and land option write-offs (“Adjusted EBITDA”) are not U.S. generally accepted accounting principle (GAAP) financial measures. The most directly comparable GAAP financial measure is net income (loss). The reconciliation of EBITDA and Adjusted EBITDA to net income (loss) is presented in a table attached to this earnings release.

Cash flow is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Cash Flow from Operating Activities. The Company uses cash flow to mean cash flow from operating activities and cash flow from investing activities excluding changes in mortgage notes receivable at the mortgage company.

(Loss) Income Before Income Taxes Excluding Land Related Charges and Intangible Impairments is a non-GAAP financial measure. The most directly comparable GAAP financial measure is Loss Before Income Taxes. The reconciliation of (Loss) Income Before Income Taxes Excluding Land Related Charges and Intangible Impairments to Loss Before Income Taxes is presented in a table attached to this earnings release.

Note: All statements in this Press Release that are not historical facts should be considered as “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks, uncertainties and other factors include, but are not limited to, (1) changes in general and local economic and industry and business conditions, (2) adverse weather conditions and natural disasters, (3) changes in market conditions and seasonality of the Company’s business, (4) changes in home prices and sales activity in the markets where the Company builds homes, (5) government regulation, including regulations concerning development of land, the home building, sales and customer financing processes, and the environment, (6) fluctuations in interest rates and the availability of mortgage financing, (7) shortages in, and price fluctuations of, raw materials and labor, (8) the availability and cost of suitable land and improved lots, (9) levels of competition, (10) availability of financing to the Company, (11) utility shortages and outages or rate fluctuations, (12) levels of indebtedness and restrictions on the Company’s operations and activities imposed by the agreements governing the Company’s outstanding indebtedness, (13) operations through joint ventures with third parties, (14)

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product liability litigation and warranty claims, (15) successful identification and integration of acquisitions, (16) significant influence of the Company’s controlling stockholders, (17) geopolitical risks, terrorist acts and other acts of war and (18) other factors described in detail in the Company’s Form 10-K for the year ended October 31, 2007.

(Financial Tables Follow)

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Hovnanian Enterprises, Inc.
January 31, 2008
Statements of Consolidated Operations
(Dollars in Thousands, Except Per Share)

	Three Months Ended, January 31,
	2008			2007
	(Unaudited)
Total Revenues	$	1,093,701		$	1,165,801
Costs and Expenses (a)		1,257,456			1,234,395
(Loss) Income from Unconsolidated Joint Ventures		(5,039	)		1,965
Loss Before Income Taxes		(168,794	)		(66,629	)
Income Tax Benefit		(37,851	)		(12,021	)
Net Loss		(130,943	)		(54,608	)
Less: Preferred Stock Dividends		—			2,669
Net Loss Available to Common Stockholders	$	(130,943	)	$	(57,277	)
Per Share Data:
Basic:
Loss per common share	$	(2.07	)	$	(0.91	)
Weighted Average Number of                  Common Shares Outstanding		63,358			62,904
Assuming Dilution:
Loss per common share	$	(2.07	)	$	(0.91	)
Weighted Average Number of                  Common Shares Outstanding (b)		63,358			62,904

(a) Includes inventory impairment loss and land option write-offs.

(b) For periods with a net loss, basic shares are used in accordance with GAAP rules.

Reconciliation of (Loss) Income Before Income Taxes Excluding Land Related Charges and Intangible Impairments to Loss Before Income Taxes

(Dollars in Thousands)

	Three Months Ended, January 31,
	2008			2007
	(Unaudited)
Loss Before Income Taxes	$	(168,794	)	$	(66,629	)
Inventory Impairment Loss and Land Option Write-Offs		90,168			41,474
Intangible Impairments		—			51,497
Unconsolidated Joint Venture intangible and land-related charges		4,007			—
(Loss) Income Before Income Taxes Excluding
Land Related Charges and Intangible Impairments	$	(74,619	)	$	26,342

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Hovnanian Enterprises, Inc.
January 31, 2008
Gross Margin
(Dollars in Thousands)

	Homebuilding Gross Margin Three Months Ended January 31,
	2008			2007
	(Unaudited)
Sale of Homes	$	1,051,818		$	1,135,916
Cost of Sales, excluding interest (a)		981,568			931,483
Homebuilding Gross Margin, excluding interest		70,250			204,433
Homebuilding Cost of Sales interest		27,963			26,816
Homebuilding Gross Margin, including interest	$	42,287		$	177,617
Gross Margin Percentage, excluding interest		6.7	%		18.0	%
Gross Margin Percentage, including interest		4.0	%		15.6	%
	Land Sales Gross Margin Three Months Ended January 31,
	2008			2007
	(Unaudited)
Land Sales	$	22,753		$	3,599
Cost of Sales, excluding interest (a)		21,996			2,492
Land Sales Gross Margin, excluding interest		757			1,107
Land Sales interest		625			56
Land Sales Gross Margin, including interest	$	132		$	1,051

(a) Does not include inventory impairment losses or land option write-offs which are recorded as inventory impairment losses in the Statement of Consolidated Operations.

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Hovnanian Enterprises, Inc.
January 31, 2008
Reconciliation of Adjusted EBITDA to Net Loss
(Dollars in Thousands)

	Three Months Ended January 31,
	2008			2007
	(Unaudited)
Net Loss	$	(130,943	)	$	(54,608	)
Income Tax Benefit		(37,851	)		(12,021	)
Interest expense		29,128			28,092
EBIT (1)		(139,666	)		(38,537	)
Depreciation		4,597			4,384
Amortization of Debt Costs		593			700
Amortization of Intangibles		935			61,556
EBITDA(2)		(133,541	)		28,103
Inventory Impairment Loss and Land Option Write-offs		90,168			41,474
Adjusted EBITDA(3)	$	(43,373	)	$	69,577
INTEREST INCURRED	$	44,916		$	45,297
ADJUSTED EBITDA TO INTEREST INCURRED		(0.97	)		1.54

(1) EBIT is a non-GAAP financial measure. The comparable GAAP financial measure is net loss. EBIT represents earnings before interest expense and income taxes.

(2) EBITDA is a non-GAAP financial measure. The comparable GAAP financial measure is net loss. EBITDA represents earnings before interest expense, income taxes, depreciation and amortization.

(3) Adjusted EBITDA is a non-GAAP financial measure. The comparable GAAP financial measure is net loss. Adjusted EBITDA represents earnings before interest expense, income taxes, depreciation, amortization and inventory impairment loss and land option write-offs.

Hovnanian Enterprises, Inc.
January 31, 2008
Interest Incurred, Expensed and Capitalized
(Dollars in Thousands)

	Three Months Ended January 31,
	2008		2007
	(Unaudited)
Interest Capitalized at Beginning of Period	$	155,642	$	102,849
Plus Interest Incurred		44,916		45,297
Less Interest Expensed		29,128		28,092
Interest Capitalized at End of Period(1)	$	171,430	$	120,054

(1) The Company incurred significant inventory impairments in recent quarters, which are determined based on total inventory including capitalized interest. However, in accordance with GAAP, the Company is not able to reduce the capitalized interest balance by allocating any portion of the impairments to capitalized interest.

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HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)

	January 31, 2008		October 31, 2007
ASSETS
	(unaudited)
Homebuilding:
Cash and cash equivalents	$	73,048	$	12,275
Restricted cash		4,455		6,594
Inventories - at the lower of cost or fair value:     Sold and unsold homes and lots under development		2,692,760		2,792,436
Land and land options held for future      development or sale		413,605		446,135
Consolidated inventory not owned:
Specific performance options		9,929		12,123
Variable interest entities		118,755		139,914
Other options		121,683		127,726
Total consolidated inventory not owned		250,367		279,763
Total inventories		3,356,732		3,518,334
Investments in and advances to unconsolidated     joint ventures		162,129		176,365
Receivables, deposits, and notes		88,897		109,856
Property, plant, and equipment - net		103,680		106,792
Prepaid expenses and other assets		160,822		174,032
Goodwill		32,658		32,658
Definite life intangibles		3,289		4,224
Total homebuilding		3,985,710		4,141,130
Financial services:
Cash and cash equivalents		8,279		3,958
Restricted cash		4,973		11,572
Mortgage loans held for sale		104,696		182,627
Other assets		4,807		6,851
Total financial services		122,755		205,008
Income taxes receivable - including deferred   tax benefits		216,601		194,410
Total assets	$	4,325,066	$	4,540,548

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HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In Thousands Except Share Amounts)

	January 31, 2008			October 31, 2007
LIABILITIES AND STOCKHOLDERS’ EQUITY		(unaudited)
Homebuilding:
Nonrecourse land mortgages	$	9,417		$	9,430
Accounts payable and other liabilities		456,116			515,422
Customers’ deposits		57,662			65,221
Nonrecourse mortgages secured by operating     Properties		22,803			22,985
Liabilities from inventory not owned		172,745			189,935
Total homebuilding		718,743			802,993
Financial services:
Accounts payable and other liabilities		10,488			19,597
Mortgage warehouse line of credit		97,544			171,133
Total financial services		108,032			190,730
Notes payable:
Revolving credit agreement		325,000			206,750
Senior notes		1,510,714			1,510,600
Senior subordinated notes		400,000			400,000
Accrued interest		22,310			43,944
Total notes payable		2,258,024			2,161,294
Total liabilities		3,084,799			3,155,017
Minority interest from inventory not owned		54,094			62,238
Minority interest from consolidated joint ventures		1,427			1,490
Stockholders’equity:
Preferred stock, $.01 par value-authorized 100,000     shares; issued 5,600 shares at January 31,     2008 and at October 31, 2007 with a     liquidation preference of $140,000		135,299			135,299
Common stock, Class A, $.01 par value-authorized     200,000,000 shares; issued 59,550,269 shares at     January 31, 2008 and 59,263,887 shares at     October 31, 2007 (including 11,694,720      shares at January 31, 2008 and     October 31, 2007 held in Treasury)		596			593
Common stock, Class B, $.01 par value (convertible     to Class A at time of sale) authorized     30,000,000 shares; issued 15,338,810 shares at     January 31, 2008 and 15,338,840 shares at     October 31, 2007 (including 691,748 shares at     January 31, 2008 and October 31, 2007 held in     Treasury)		153			153
Paid in capital - common stock		279,603			276,998
Retained earnings		884,352			1,024,017
Treasury stock - at cost		(115,257	)		(115,257	)
Total stockholders’ equity		1,184,746			1,321,803
Total liabilities and stockholders’ equity	$	4,325,066		$	4,540,548

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HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands Except Per Share Data)
(Unaudited)

	Three Months Ended January 31,
	2008			2007
Revenues:
Homebuilding:
Sale of homes	$	1,051,818		$	1,135,916
Land sales and other revenues		27,910			8,337
Total homebuilding		1,079,728			1,144,253
Financial services		13,973			21,548
Total revenues		1,093,701			1,165,801
Expenses:
Homebuilding:
Cost of sales, excluding interest		1,003,564			933,975
Cost of sales interest		28,588			26,872
Inventory impairment loss and land option
write-offs		90,168			41,474
Total cost of sales		1,122,320			1,002,321
Selling, general and administrative		100,169			132,142
Total homebuilding		1,222,489			1,134,463
Financial services		10,870			13,070
Corporate general and administrative		21,816			22,633
Other interest		540			1,220
Other operations		806			1,453
Intangible amortization		935			61,556
Total expenses		1,257,456			1,234,395
(Loss) income from unconsolidated joint
ventures		(5,039	)		1,965
Loss before income taxes		(168,794	)		(66,629	)
State and federal income tax
(benefit) provision:
State		2,283			(2,346	)
Federal		(40,134	)		(9,675	)
Total taxes		(37,851	)		(12,021	)
Net loss		(130,943	)		(54,608	)
Less: preferred stock dividends		—			2,669
Net loss available to common   stockholders	$	(130,943	)	$	(57,277	)
Per share data:
Basic:
Loss per common share	$	(2.07	)	$	(0.91	)
Weighted average number of common     shares outstanding		63,358			62,904
Assuming dilution:
Loss per common share	$	(2.07	)	$	(0.91	)
Weighted average number of common      shares outstanding		63,358			62,904

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HOVNANIAN ENTERPRISES, INC.
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE)
(UNAUDITED)	Communities Under Development
	Three Months - 1/31/2008
		Net Contracts (1)			Deliveries
		Three Months Ended			Three Months Ended			Contract Backlog
		January 31,			January 31,			January 31,
		2008	2007	% Change	2008	2007	% Change	2008	2007	% Change
Northeast
	Homes	198	386	(48.7%)	314	460	(31.7%)	859	1,144	(24.9%)
	Dollars	83,416	175,048	(52.3%)	160,346	213,286	(24.8%)	431,517	564,067	(23.5%)
	Avg. Price	421,295	453,492	(7.1%)	510,656	463,665	10.1%	502,348	493,066	1.9%
Mid-Atlantic
	Homes	201	431	(53.4%)	297	470	(36.8%)	657	1,095	(40.0%)
	Dollars	73,424	192,639	(61.9%)	125,558	222,688	(43.6%)	308,344	534,211	(42.3%)
	Avg. Price	365,294	446,958	(18.3%)	422,754	473,804	(10.8%)	469,321	487,864	(3.8%)
Southeast
	Homes	155	144	7.6%	1,629	814	100.1%	677	3,143	(78.5%)
	Dollars	42,423	40,021	6.0%	393,182	217,725	80.6%	195,367	895,371	(78.2%)
	Avg. Price	273,699	277,924	(1.5%)	241,364	267,475	(9.8%)	288,578	284,878	1.3%
Southwest
	Homes	545	731	(25.4%)	691	787	(12.2%)	605	943	(35.8%)
	Dollars	124,385	166,202	(25.2%)	164,184	176,170	(6.8%)	136,931	219,183	(37.5%)
	Avg. Price	228,229	227,363	0.4%	237,603	223,850	6.1%	226,333	232,432	(2.6%)
Midwest
	Homes	102	254	(59.8%)	211	196	7.7%	650	726	(10.5%)
	Dollars	18,737	55,945	(66.5%)	46,580	38,579	20.7%	126,937	137,355	(7.6%)
	Avg. Price	183,693	220,256	(16.6%)	220,758	196,832	12.2%	195,288	189,194	3.2%
West
	Homes	310	624	(50.3%)	462	539	(14.3%)	397	749	(47.0%)
	Dollars	115,405	274,853	(58.0%)	161,968	267,468	(39.4%)	149,539	338,617	(55.8%)
	Avg. Price	372,273	440,470	(15.5%)	350,580	496,230	(29.4%)	376,674	452,092	(16.7%)
Consolidated Total
	Homes	1,511	2,570	(41.2%)	3,604	3,266	10.3%	3,845	7,800	(50.7%)
	Dollars	457,790	904,708	(49.4%)	1,051,818	1,135,916	(7.4%)	1,348,635	2,688,804	(49.8%)
	Avg. Price	302,971	352,026	(13.9%)	291,847	347,800	(16.1%)	350,750	344,718	1.7%
Unconsolidated Joint Ventures
	Homes	108	43	151.2%	155	289	(46.4%)	380	884	(57.0%)
	Dollars	52,747	(2,170)	2530.7%	66,568	108,496	(38.6%)	187,417	410,104	(54.3%)
	Avg. Price	488,397	(50,465)	1067.8%	429,469	375,419	14.4%	493,203	463,919	6.3%
Total
	Homes	1,619	2,613	(38.0%)	3,759	3,555	5.7%	4,225	8,684	(51.3%)
	Dollars	510,537	902,538	(43.4%)	1,118,386	1,244,412	(10.1%)	1,536,052	3,098,908	(50.4%)
	Avg. Price	315,341	345,403	(8.7%)	297,522	350,046	(15.0%)	363,563	356,853	1.9%
DELIVERIES INCLUDE EXTRAS
Notes:
(1) Net contracts are defined as a new contracts signed during the period for the purchase of homes, less cancellations of prior contracts.

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