Lennar Corp. reported better-than-expected quarterly orders as the record shortage of existing-home listings pushed buyers toward newly built properties.
Purchase contracts for the three months through February rose 1% from a year earlier to 15,747, the Miami-based company said in a statement Wednesday. Analysts were expecting 14,987 orders, according to a Bloomberg survey. Lennar boosted its full-year guidance for home deliveries, average sales price and margins.
The results reflect continued strength in the housing market across the U.S., Executive Chairman Stuart Miller said in the statement. Buyer traffic “suggests that demand remains strong for the foreseeable future,” he said.
U.S. builders including Lennar have been pushing up prices to take advantage of soaring demand as rising mortgage rates nudge buyers to purchase before they climb even more.
The gross margin for the quarter was 26.9%, suggesting that profitability remained high even in the face of rising costs for labor and materials, the company said.
Lennar has been focusing on less-expensive options that appeal to young people who are increasingly getting priced out of the market for previously owned homes, which are in critically short supply.
The company is well-positioned to take advantage of the boom in suburban housing, which has only intensified as buyers look for more space and backyards.
The shares rose as much as 4.1% in late trading before paring gains. They have fallen 24% this year through Wednesday’s close.
Lennar said it expects to deliver 68,000 homes in fiscal 2022, up from its previous projection of 67,000. The company sees gross margins in the range of 27.25% to 28%, and an average sales price of $470,000 to $475,000.
