Friday, February 15, 2013

Lawler: Publicly-Traded Home Builder Results and Comparison to Census New Home Sales

by Bill McBride on 2/15/2013 03:28:00 PM

From economist Tom Lawler:

Below is a summary of some selected stats from nine large publicly-traded home builders.

While not shown below, the combined order backlog of these builders on December 31, 2012 was 28,455, up 55.8% from the end of 2011.

As I’ve noted before, comparing these builder results with the Census Bureau’s estimate of overall US new home sales is tricky; first, Census deals with sales cancellations differently from home builder results, and second, there appear to be differences between when builders “book” a sales order and when Census “counts” a sale.

While I only have data for the above builders back to Q2/2009, the limited data suggest that reported builder sales “lead” the Census home sales data. At the bottom is a chart showing Census new home sales data and a two-quarter average of the above builders’ net orders data (shown in index form).

Net OrdersSettlementsAverage Closing Price
Qtr. Ended:Dec 2012Dec 2011% ChgDec 2012Dec 2011% ChgDec 2012Dec 2011% Chg
D.R. Horton5,2593,79438.6%5,1824,11825.8%$236,067 $214,740 9.9%
PulteGroup3,9263,08427.3%5,1544,30319.8%$287,000 $271,000 5.9%
NVR2,6252,15821.6%2,7882,39116.6%$331,900 $304,600 9.0%
The Ryland Group1,50291564.2%1,5781,04051.7%$270,000 $254,000 6.3%
Beazer Homes93272428.7%1,03886719.7%$235,500 $215,500 9.3%
Standard Pacific98361559.8%97378224.4%$388,000 $374,000 3.7%
Meritage Homes1,09474946.1%1,24089438.7%$294,000 $275,000 6.9%
MDC Holdings86952366.2%1,22179254.2%$318,700 $291,300 9.4%
M/I Homes67350533.3%88766733.0%$273,000 $257,000 6.2%
Total17,86313,06736.7%20,06115,85426.5%$282,723 $263,035 7.5%

Homebuider Results and Census data Click on graph for larger image.

The chart suggests that Census’ industry estimates and these nine builders’ net orders moved pretty closely together from 2009 through early 2012. Over the last three quarters, however, these nine builders’ net orders showed considerably more strength that Census’ estimates in the last three quarters of 2012, with the “gap” widening throughout the year. This suggests either that large builders’ share of the new SF home market increased last year, though it also suggests that Census’ new home sales estimate for the last quarter of 2012 may be revised upward.