September Builder Intelligence Report: Builders Rethink Raising Prices
September 30, 2019
The latest Builder Intelligence Report, compiled by BTIG in partnership with HomeSphere, indicates builders are still seeing solid demand trends at the same time they’re wary of raising prices too much.
While metrics softened slightly in August from a strong July, builders saw a continuation of the improvement in business from late 2018. However, BTIG researchers suggest consumers remain highly sensitive to price while field conditions remain competitive in most major markets.
Highlights from the Latest Builder Intelligence Report
Sales and traffic. Forty-nine percent of respondents reported year over year increases in sales orders versus 51 percent in July and in August 2018. Forty-six percent noted year over year increases in traffic versus 49 percent in July.
Expectations. More builders reported sales and traffic ahead of expectations than behind with 27 percent of respondents reporting traffic was better than expected. Fourteen percent reported it was worse than expected.
Pricing and incentives. Pricing power slowed a fair degree with only seven percent of builders raising “most or all” base prices, the lowest reading recorded in survey history. Competitive field conditions and buyer sensitivity are likely keeping builders wary about aggressive increases despite lower interest rates.
Input costs. Thirty-six percent of respondents reported month over month increases in subcontractor labor costs, but outside of a spike in June, there has been a long-term decline in builders reporting cost increases over last year.
HomeSphere/BTIG Builder Intelligence Report
HomeSphere partners with the research firm BTIG to create a monthly report to provide our builders and manufacturers with exclusive and timely insights about the market.
To compile the report, we survey HomeSphere’s 2,600 regional and local home builders about sales, traffic, pricing, labor costs and other key industry metrics.
How to Get The Monthly Report
If you are a builder and would like to participate and receive the monthly report for free, request an invitation below: