Positive Sales Growth Continues for Home Builders in June
July 17, 2020
In our latest State of the Industry Report, compiled by BTIG, year-over-year sales growth continued to improve for home builders in June, approaching pre-COVID survey-record highs.
Our monthly survey included 98 responses from small to midsized home builders who generally reported a sharp rebound from April’s low numbers. Overall, we’re continuing to see demand improve thanks in part to pent-up demand following March and April’s shutdown orders and improving field conditions.
Builders also saw more pricing power and relied less on incentive usage in June, and suggested they were seeing more quality traffic.
Highlights from the latest State of the Industry Report
Sales and traffic. Sixty percent of respondents reported year-over-year increases in sales compared to 47 percent in May and 40 percent in June 2019. Forty-eight percent also reported an increase in year-over-year traffic, while 31 percent reported a decline. In May, 39 percent reported increased traffic. More builders are also reporting better quality traffic at 65 percent in June compared to 52 percent in May.
Expectations. A survey record of 56 percent of respondents said sales were better than expected in June compared to 54 percent in May. Only 10 percent reported them as worse than expected versus 18 percent in May.
Pricing and incentives. Forty-four percent of builders reporting raising some, most or all base prices, compared to 28 percent in May. Only two percent of builders lowered some, most or all prices compared to five percent in May and 12 percent a year ago. Builders also lowered incentive use, with 12 percent reporting increasing some, most or all sales incentives compared to 20 percent in May.
Input costs. More respondents reported material and lot cost increases, while labor costs remained steadier. Forty-seven percent of respondents reported rising month-over-month materials costs compared to 40 percent in May.
HomeSphere/BTIG State of the Industry 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: