UPDATE 1-Levitt & Sons files for bankruptcy protection

CHICAGO Nov 9 (Reuters) - Levitt & Sons, the home building unit of Levitt Corp LEV.N that created one of the first American suburbs, said on Friday that it had filed for bankruptcy protection, reflecting the badly battered Florida market.

The unit, which made ost of its money in Florida, said Chapter 11 filing in U.S. Bankruptcy Court in the Southern District of Florida, was made "in response to unprecedented conditions in the homebuilding industry, which have severely impacted the company."

Levitt, which built "Levittown," a subdivision in Long Island, New York that is widely regarded as the first master-planned community, said the downturn was especially pronounced in Florida, where nearly all of its focus has resided.

The filing is the latest sign of the serious downturn in the U.S. housing market, where lax and abusive lending practices in recent years -- as well as outright fraud -- have resulted in rising mortgage delinquencies, falling home prices and stagnant sales in many markets.

Separately on Friday, Fort Lauderdale, Florida-based Levitt said it swung to a loss in the most recent quarter as a result of the ongoing slump. It reported a third-quarter loss of $169.2 million, or $8.37 a share, compared with net income of $3.0 million or 14 cents a share last year.