Takeaways from the Builder 100 Conference, Dana Point, CA
Builders remain optimistic as a strong spring selling season persists, with inventory of quick move-ins continuing to fall
Six months ago, "spec homes” were a liability, but with higher demand and some elegant rebranding, “quick move-ins” are now an asset once again
New home sales continue to take share from existing as consumers “locked in” to low mortgage rates tend to remodel vs. sell which is limiting supply overall
Move-up homes are the top seller right now, possibly linked to a pandemic-induced baby boom
Storm clouds remain on the horizon, but no certainty if they’re moving closer or blowing offshore. Rising rates and reduced liquidity from capital restrictions at banks are keeping the debt markets tight and equity on the sidelines waiting for bluer skies
Public builders represent 47% of total sales nationally, increasing from 37% pre-pandemic, and consensus expectation of (or fear of) 60%+ market share by the end of the decade
Private builders need to leverage local market data and research insights, and focus on differentiating product or service to be nimble and stay ahead of competition
Build-to-rent (BTR) continues to be an attractive new sales outlet for builders, albeit many builders who had earmarked projects for BTR are pivoting some back to for-sale given the strong retail market rebound
Housing mobility is at all-time lows, though it may pick up in the next few years, creating opportunities for builders with compelling product in desirable locations
Industry consolidation through M&A will continue in the decade ahead, and likely accelerate in the near-term
Public builders have cash reserves and an investor mandate to grow
International interest in the U.S. remains strong given positive demographic tailwinds