Pretax mortgage income at NVR Inc. surged 37% year-over-year in the second quarter while originations rose 1%, contrasting more tepid home-loan earnings results relative to originations
"The increase in income before tax is primarily due to a 16% increase in mortgage banking fees, resulting from an increase in secondary marketing gains and the timing of loan sales," according to NVR's earnings' report.
Closed loan production at NVR totaled more than $1.2 billion during the quarter and its pretax mortgage banking income totaled more than $25 million.
On a year-over-year basis, the company's overall net income rose 3% to more than $203 million, its diluted earnings per share grew 8% to $49.05 and its consolidated revenue was up 1% at more than $1.8 billion.
During the quarter, the company's building unit improved upon its strong
New orders in the company's homebuilding division rose 6% year-over-year to 5,239 and its settlements increased by 2% to 4,720. The builder unit's backlog of homes sold but not settled at quarter-end fell 6% to 9,530 on a unit basis, and decreased by 9% on a dollar basis to more than $3.5 billion.
But the average prices of homes sold was down 5% at $358,600 "due to a shift to smaller, lower-priced products, as well as a shift to markets with lower average sales prices."
The gross profit margin in the homebuilding unit fell slightly to 18.9% from 19.1% and revenue in the builder division of was "relatively flat" year-over-year at almost $1.76 billion.
NVR's building unit operates in 32 metropolitan areas within 14 states and Washington, D.C. The division builds homes under the following trade names: Ryan Homes, NVHomes and Heartland Homes.
