Ryland Group Inc. reported a third-quarter loss Wednesday as sales fell and tighter lending terms choked out potential buyers from a slumping real estate market.

Ryland reported a loss for the quarter ended September 30 of $55 million (-$1.30 per share), compared with net income of $88 million ($1.97) from the same period a year earlier, falling in line with Wall Street’s expectation of a $1.29-per-share loss, according to data complied by Bloomberg News.

Revenue for the Calabasas-based homebuilder fell 32 percent to $732 million.

Lenders have tightened the availability of mortgages by raising rates while homebuilders are struggling to reduce a 10-month supply of unsold homes by offering discounts and auctioning properties, perpetuating losses.

Despite the loss, shares in Ryland closed up 3 percent to $26.26 Wednesday in trading on the New York Stock Exchange.