Lawler: Q1 Home Builder Results

From housing economist Tom Lawler:

Below is a table showing some selected operating statistics from large, publicly-traded home builders for the quarter ending March 31, 2016.

Here a few (of what could be many) points.

1. In terms of units, 27% of D.R. Horton’s net orders last quarter were from its “entry level” Express brand, up from 18% in the first quarter of last year. Express comprised 23% of Horton’s deliveries last quarter, up from 8% a year earlier.

2. Both Meritage Homes and MDC Holdings said that they either had or were to planning to increase production of lower priced homes (“entry-level-plus” in Mertigage’s case, and their “new, more affordable product line” in MDC’s case.

3. Meritage Homes said that its margins were in “a handful” of communities in Southern California and Arizona that it acquired in 2013 were adversely impacted by the reduction in FHA loan limits in those markets effective at the beginning of 2014. Specifically, the company said that “(w)hen those loan limits were reduced, we weren’t able to get the prices we were expecting ...”

	Net Orders			Settlements			Average Closing  Price ($000s)
Qtr. Ended:	3/16	3/15	% Chg	3/16	3/15	% Chg	3/16	3/15	% Chg
D.R. Horton	12,292	11,135	10.4%	9,262	8,243	12.4%	290	281	3.1%
Pulte Group	5,652	5,139	10.0%	3,945	3,365	17.2%	353	323	9.3%
NVR	4,137	3,926	5.4%	3,006	2,534	18.6%	369	371	-0.4%
Cal Atlantic	4,135	3,960	4.4%	2,727	2,435	12.0%	432	398	8.5%
Beazer Homes	1,538	1,698	-9.4%	1,150	936	22.9%	328	306	7.3%
Meritage Homes	1,987	1,979	0.4%	1,488	1,335	11.5%	400	387	3.4%
MDC Holdings	1,646	1,593	3.3%	907	909	-0.2%	435	420	3.6%
M/I Homes	1,314	1,108	18.6%	876	717	22.2%	353	325	8.6%
Sub Total	32,701	30,538	7.1%	23,361	20,474	14.1%	344	329	4.7%
LGI Homes				844	671	25.8%
Total	32,701	30,538	7.1%	24,205	21,145	14.5%	332	318	4.4%