(Disclosure: Rose Law Group represents Meritage Homes.)
By Vincent Salandro | Builder
Stabilizing demand helped Meritage Homes deliver record levels of closings and closing revenue during the first quarter.
“Meritage’s first quarter 2023 performance reflected stabilizing demand as interest rates dipped slightly and buyers began accepting 6% to 7% mortgage interest rates as the new normal,” executive chairman Steven Hilton said. “The Meritage team executed on our spec strategy and delivered solid results this quarter.”
Similar to other public home building peers, Meritage reported better-than-expected earnings results in the fiscal first quarter, driven by improved demand conditions and the availability of move-in inventory amid wider economic uncertainty. While the home builder’s profit ($131.3 million) and profit per share ($3.54) were both lower on a year-over-year basis, Meritage outperformed analyst projections of $2.64 profits per share for the quarter.
“In the first quarter of 2023, our offering of move-in ready homes and a combination of price cuts and incentives gave us a competitive advantage that allowed us to meet our targeted sales objectives,” Hilton said.
During the first quarter, Meritage’s average absorption pace of 4.2 per month was above the builder’s goal of three to four per month. The builder closed 2,897 homes in the quarter, representing $1.3 billion in closing revenue, both up 1% compared with the first quarter of 2022.