Ryland Group Inc., the nation’s eighth-largest homebuilder, reported a 9 percent decline in second-quarter profit.

Profits from the Calabasas-based company dropped to $94.8 million, or $2.03 a share, from $104.3 million, or $2.10 a share, a year ago. The company attributed the drop to rising expenses and a limited overall revenue increase of 3 percent, or $1.2 billion, marginally up from $1.16 billion the same time last year.

According to the company, its homebuilding revenue was up 3 percent, financial services revenue was down 8 percent and total expenses increased 5 percent. Despite a rise in the average closing price on a Ryland home, which was up 8.5 percent to $295,000, the company had only 3,800 closings in the quarter, down 5.8 percent from last year. At the end of the quarter the company also said its backlog of homes awaiting construction was 8,150 homes with a combined-sales value of $2.52 billion, down from 10,534 homes and $3.07 billion the previous year.

The company dropped its earnings forecast for 2006 to between $7.75 and $8.25 a share. In late May, the company said it expected $8.50 to $9 in profit per share.