EXHIBIT 99.2

[KB HOME LOGO]

PRESS RELEASE

FOR RELEASE THURSDAY, JANUARY 10, 2002	For Further Information Contact:
5:30 AM Pacific Standard Time	Clem Teng, Investor Relations (310) 231-4033 or cteng@kbhome.com Kate Mulhearn, Media Contact (310) 231-4147 or kmulhearn@kbhome.com

KB HOME REPORTS RECORD FOURTH QUARTER EARNINGS
Net Income Advances 20.6%; EPS Beats Consensus Estimates;
Year-end Backlog Reaches an All-time High of 11,225 Units

     Los Angeles, California, January 10, 2002— KB Home (NYSE: KBH), one of the largest homebuilders in the United States and France, today announced record results for its fourth quarter and fiscal year ended November 30, 2001. Highlights include:

• Unit deliveries reached an all-time fourth quarter high of 7,883 units, driving total revenues to $1.45 billion, the highest fourth quarter level in the Company’s history. Net income for the quarter advanced 20.6% to a record $88.5 million, or $2.03 per diluted share.

• Full year 2001 net income advanced to $214.2 million, or $5.50 per diluted share, the highest level in the Company’s history. Full year unit deliveries of 24,868 and total revenues of $4.57 billion surpassed the Company’s previous records of 22,847 deliveries and $3.93 billion in revenues established in 2000. The Company’s deliveries have grown at a five-year compound annual rate of 19%.

• The Company ended the year with substantial liquidity, including $281.3 million in cash and $564.1 million of available borrowing capacity under its revolving credit facility.

• The Company’s ratio of debt to total capital improved 4 percentage points to 49.9% at November 30, 2001 from 53.9% at November 30, 2000. Stockholders’ equity rose 66.9% to $1.09 billion at November 30, 2001 from $654.8 million at November 30, 2000. The Company’s average return on equity for the last five years has exceeded 20%.

• Year-end backlog exceeded 11,000 units for the first time in the Company’s history and represented future revenues of $1.91 billion at November 30, 2001, providing excellent visibility for 2002 results.

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     “In the fourth quarter, with EPS of $2.03, KB Home continued the trend of consistent financial performance and beat Wall Street consensus estimates by more than 10%. The homebuilding industry in general and KB Home in particular have exhibited remarkable resilience during the recent economic slowdown and the aftermath of the tragic events of September 11th,” commented Bruce Karatz, Chairman and Chief Executive Officer. “We believe the industry’s performance during this economic downturn demonstrates the strength of our industry and reflects the positive evolution of large public homebuilders. Our capital structure and operational disciplines allow us to deliver more consistent results even during challenging times.”

     Net income rose 20.6% to $88.5 million, or $2.03 per diluted share, in the fourth quarter from $73.4 million, or $2.00 per diluted share for the same quarter of 2000. The increase in net income for the quarter ended November 30, 2001 stemmed from higher unit delivery volume and increased income from the Company’s mortgage banking operations. The Company’s year-over-year earnings per share growth for the fourth quarter was adversely impacted by an 18.3% increase in the average number of shares outstanding resulting from the Company’s conversion of its Feline Prides in August 2001.

     Unit deliveries (including deliveries from joint ventures) rose 10.0% to 7,883 units in the fourth quarter of 2001 from 7,168 units in the same quarter of 2000. Total construction revenues for the quarter ended November 30, 2001 were $1.43 billion, the highest for any fourth quarter in the Company’s history, up from $1.23 billion for the same quarter a year ago. Housing revenues reached $1.40 billion, increasing 16.2% from $1.20 billion in the year-earlier quarter due to the combined effects of higher unit volume and a higher average selling price, which rose 5.2% to $178,800 for the fourth quarter of 2001 from $169,900 for the same quarter of 2000. Construction revenues for the fourth quarter of 2001 included French commercial revenues of $16.3 million and land sales of $13.1 million.

     “We had an excellent fourth quarter and full year in 2001 with solid increases in unit volume, revenues and earnings,” stated Karatz. “The strategies we have employed to reduce the financial risk in our business and deliver predictable, sustainable performance are working as planned. Our unit deliveries and earnings have grown at five-year compound annual rates of 19% and 37%, respectively, and our average return on equity for the last five years has exceeded 20%. It is my hope that the multiples and valuations in the homebuilding industry will increase as KB Home and other homebuilders continue to demonstrate that our industry has become less sensitive to economic swings.”

     Construction operating income for the fourth quarter totaled $135.1 million compared with $121.5 million in the year-earlier quarter, an increase of 11.2%, generated mainly from the combined effects of higher unit volume and housing gross margins. The Company’s housing gross margin rose to 20.8% in the three months ended November 30, 2001 from 20.6% in the same period of 2000. Commercial activities and land sales produced total profits of $3.6 million in the fourth quarter of 2001 compared to profits of $2.7 million generated in the fourth quarter of 2000.

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     Pretax income from the Company’s mortgage banking operations rose 80.7% to $14.5 million in the fourth quarter of 2001 from $8.0 million in the same quarter a year ago, benefiting from higher domestic unit volume, increased retention and a favorable ratio of fixed rate to variable rate loans.

     “We ended the year in a solid financial position with over $280 million in cash, plenty of available borrowing capacity and our leverage ratio below 50%,” commented Karatz. “The financial flexibility we have achieved as a result of strong earnings growth and the strategic management of our business should enable us to navigate through the current economic climate and seize opportunities presented.”

     Total stockholders’ equity advanced 66.9% from the prior year to $1.09 billion at November 30, 2001. On a per share basis, stockholders’ equity was $25.87 at November 30, 2001 compared to $19.16 at November 30, 2000. The Company’s ratio of debt to total capital at the end of the fourth quarter improved 4 percentage points to 49.9% in 2001 from 53.9% in 2000. Net of the construction cash balance at November 30, 2001, the ratio of net debt to total capital was 42.9%. At the end of the fourth quarter of 2001, the Company had $564.1 million of available borrowing capacity as no amounts were outstanding under its revolving credit facility.

     The Company’s backlog value reached $1.91 billion on 11,225 units at November 30, 2001, the highest level for any year-end in its history. At November 30, 2001, the Company had approximately two quarters of deliveries in backlog, providing excellent visibility for 2002 earnings. Net orders of 5,353 for the fourth quarter were down slightly from 5,418 net orders in the year-earlier quarter on mixed results as year-over-year increases in net orders posted by the Central and France regions were offset by decreases in the West Coast and Southwest regions. Net orders remained volatile following the September 11th attack but regained strength late in the quarter. Year-over-year net order comparisons for the final two months of the quarter showed sequential improvement with the month of November turning positive results. Subsequent to the end of the quarter, the overall net order comparison for the month of December also remained slightly positive.

     For the year ended November 30, 2001, unit deliveries (including joint ventures) totaled 24,868, increasing 8.8% from 22,847 in the year-earlier period and establishing a new company record. Total revenues for the year rose 16.4% to $4.57 billion from $3.93 billion in the year ago period. Net income for the year ended November 30, 2001 was $214.2 million, or $5.50 per diluted share compared to $170.3 million, or $4.25 per diluted share in the year ago period (excluding a one-time gain of $39.6 million or $.99 per diluted share on the issuance of stock by the Company’s French subsidiary in an initial public offering). Including this gain, net income and diluted earnings per share for the year ended November 30, 2000 were $210.0 million and $5.24, respectively.

The Conference Call on Fourth Quarter 2001 Earnings will be broadcast live TODAY at 8:00 AM Pacific Standard Time, 11:00 AM Eastern Standard Time. To listen, please go to the Investor Relations section of the Company’s Web site at www.kbhome.com.

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     KB Home is one of America’s premier homebuilders with domestic operating divisions in the following regions and states: West Coast— California; Southwest— Arizona, Nevada and New Mexico; and Central—Colorado, Texas and Florida. Kaufman & Broad S.A., the Company’s majority-owned subsidiary, is one of the largest homebuilders in France. In fiscal 2001, the Company delivered homes to 24,868 families in the United States and France. It also operates a full-service mortgage company for the convenience of its buyers. Founded in 1957, KB Home is a Fortune 500 company listed on the New York Stock Exchange under the ticker symbol “KBH.” For more information about any of KB Home’s new home communities, call 1-800-34-HOMES or visit the Company’s Web site at www.kbhome.com.

     Except for the historical information contained herein, certain matters discussed in this press release are “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995, including any statements concerning future financial performance, business and prospects, and future Company actions and their expected results. These forward-looking statements are subject to risks, uncertainties and assumptions including, but not limited to, the continued impact of the recent terrorist activities and U.S. response, accelerating recessionary trends and other adverse changes in general economic conditions, material prices, labor costs, interest rates, uncertainties associated with California’s electricity supply problems, the secondary market for loans, consumer confidence, competition, currency exchange rates (insofar as they affect the Company’s operations in France), environmental factors, government regulations affecting the Company’s operations, the availability and cost of land in desirable areas, unanticipated violations of Company policy, unanticipated legal proceedings, and conditions in the capital, credit and homebuilding markets. See the Company’s Annual Report on Form 10-K and its Annual Report to Shareholders for the year ended November 30, 2000 and its other filings for a further discussion of these and other risks and uncertainties applicable to the Company’s business.

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(Tables Follow)
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KB HOME
CONSOLIDATED STATEMENTS OF INCOME
For the Twelve Months and Three Months Ended November 30, 2001 and 2000
(In Thousands, Except Per Share Amounts)

			Twelve Months						Three Months
			2001			2000			2001			2000
Total revenues			$	4,574,184		$	3,930,858		$	1,450,861		$	1,244,067
Construction:
	Revenues			4,501,715			3,870,488			1,426,419			1,225,152
	Costs and expenses			(4,149,399	)		(3,581,879	)		(1,291,341	)		(1,103,667	)
	Operating income			352,316			288,609			135,078			121,485
	Interest income			3,559			5,782			913			761
	Interest expense, net of amounts capitalized			(41,072	)		(31,479	)		(10,349	)		(9,152	)
	Minority interests			(27,932	)		(31,640	)		(7,658	)		(10,699	)
	Equity in pretax of unconsolidated joint ventures			3,875			2,926			1,494			673
	Gain on issuance of French subsidiary stock			—			39,630			—			—
	Construction pretax income			290,746			273,828			119,478			103,068
Mortgage banking:
	Revenues:
		Interest income		21,935			21,130			6,073			5,229
		Other		50,534			39,240			18,369			13,686
				72,469			60,370			24,442			18,915
	Expenses:
		Interest		(18,436	)		(19,374	)		(3,984	)		(5,118	)
		General and administrative		(20,262	)		(17,164	)		(5,928	)		(5,758	)
	Mortgage banking pretax income			33,771			23,832			14,530			8,039
Total pretax income				324,517			297,660			134,008			111,107
Income taxes				(110,300	)		(87,700	)		(45,500	)		(37,700	)
Net income			$	214,217		$	209,960		$	88,508		$	73,407
Basic earnings per share			$	5.72		$	5.39		$	2.10		$	2.10
Diluted earnings per share			$	5.50		$	5.24		$	2.03		$	2.00
Basic average shares outstanding				37,465			38,931			42,188			34,977
Diluted average shares outstanding				38,919			40,069			43,500			36,756

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KB HOME
CONSOLIDATED BALANCE SHEETS
(In Thousands)

		November 30,		August 31,		November 30,
		2001		2001		2000
ASSETS
Construction:
	Cash and cash equivalents	$	266,195	$	33,725	$	21,385
	Receivables		437,043		371,581		306,581
	Inventories		1,884,761		1,969,675		1,657,401
	Investments in unconsolidated joint ventures		8,844		8,696		10,407
	Deferred income taxes		118,584		66,633		73,842
	Goodwill		190,785		192,399		202,177
	Other assets		77,310		96,137		89,975
			2,983,522		2,738,846		2,361,768
Mortgage banking:
	Cash and cash equivalents		15,138		11,456		11,696
	Receivables		686,403		540,322		446,302
	Other assets		7,803		8,574		9,155
			709,344		560,352		467,153
Total assets		$	3,692,866	$	3,299,198	$	2,828,921
LIABILITIES AND STOCKHOLDERS’ EQUITY
Construction:
	Accounts payable	$	446,279	$	343,861	$	311,537
	Accrued expenses and other liabilities		351,144		246,495		201,672
	Mortgages and notes payable		1,088,615		1,135,293		987,980
			1,886,038		1,725,649		1,501,189
Mortgage banking:
	Accounts payable and accrued expenses		33,289		15,032		11,135
	Notes payable		595,035		485,631		385,294
	Collateralized mortgage obligations secured by mortgage-backed securities		22,359		23,934		29,928
			650,683		524,597		426,357
Minority interests			63,664		59,407		246,616
Stockholders’ equity			1,092,481		989,545		654,759
Total liabilities and stockholders’ equity		$	3,692,866	$	3,299,198	$	2,828,921

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KB HOME
SUPPLEMENTAL INFORMATION
For the Twelve Months and Three Months Ended November 30, 2001 and 2000

			Twelve Months				Three Months
			2001		2000		2001		2000
Construction Revenues:
	Housing		$	4,367,001	$	3,769,154	$	1,397,061	$	1,202,023
	Commercial			69,888		802		16,298		802
	Land			64,826		100,532		13,060		22,327
		Total	$	4,501,715	$	3,870,488	$	1,426,419	$	1,225,152

			Twelve Months				Three Months
			2001		2000		2001		2000
Costs and Expenses:
	Construction and land costs		$	3,612,936	$	3,123,869	$	1,132,447	$	974,527
	Selling, general and administrative expenses			536,463		458,010		158,894		129,140
		Total	$	4,149,399	$	3,581,879	$	1,291,341	$	1,103,667

			Twelve Months				Three Months
			2001		2000		2001		2000
Average Sales Prices:
	West Coast		$	283,100	$	257,000	$	286,300	$	262,700
	Southwest			157,600		145,200		161,000		148,200
	Central			140,700		128,600		146,100		130,400
	Foreign			146,300		158,700		146,500		153,500
		Total	$	178,000	$	168,300	$	178,800	$	169,900

			Twelve Months				Three Months
			2001		2000		2001		2000
Net Orders:
	West Coast			4,772		6,018		973		1,198
	Southwest			6,478		6,036		1,156		1,337
	Central			10,029		8,923		2,051		1,941
	Foreign			3,436		2,854		1,156		836
		Total		24,715		23,831		5,336		5,312
	Unconsolidated Joint Ventures:			220		444		17		106

			Twelve Months				Three Months
			2001		2000		2001		2000
Unit Deliveries:
	West Coast			5,550		5,476		1,628		1,697
	Southwest			6,238		5,832		1,797		1,623
	Central			9,368		8,112		3,069		2,631
	Foreign			3,382		2,972		1,320		1,124
		Total		24,538		22,392		7,814		7,075
	Unconsolidated Joint Ventures:			330		455		69		93

			November 30, 2001				November 30, 2000
			Backlog Units		Backlog Value		Backlog Units		Backlog Value
Backlog Data:
	West Coast			1,643	$	474,645		2,421	$	643,620
	Southwest			2,551		420,282		2,311		345,609
	Central			4,921		700,251		4,010		541,258
	Foreign			2,012		294,870		1,817		272,901
		Total		11,127	$	1,890,048		10,559	$	1,803,388
	Unconsolidated Joint Ventures:			98	$	20,384		208	$	42,224

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