The percentage of first-time homebuyers financed through builder D.R. Horton's in-house mortgage unit has risen notably as market trends have driven it to intensify its focus on lower-priced housing.
The first-time homebuyer share of borrowers rose to 50% in the first quarter of its fiscal year, up from 43% during the same quarter in the previous fiscal year. This is the highest the company's FTHB share has been in at least three years. First-time homebuyers don't always seek homes with lower price points, but many of them do.
"Sales prices for both new and existing homes have increased across most of our markets over the past several years, which, coupled with rising interest rates, has impacted affordability and resulted in some moderation of demand for homes, particularly at higher price points," Chairman Donald Horton noted in the company's earnings release.
"However, we continue to see good demand and a limited supply of homes at affordable prices across our markets, and economic fundamentals and financing availability remain solid."
D.R. Horton's overall net income between Oct. 1 and Dec. 31, 2018 rose 52% year-over-year to $287 million due to tax reform. But at $0.76 per share, its earnings were 2 cents lower than consensus estimates, according to Zacks Equity Research.
The builder's in-house mortgage unit handled homebuyers' financing for 54% of its total home closing during the first quarter of fiscal 2019, down slightly from 56% during the same quarter the previous year.
D.R. Horton's recent
