Home Builders Share High Hopes for 2022, End 2021 Strong

December 21, 2021


Big news for next year: more than half of the home builders who participated in the latest State of the Industry report, compiled with BTIG, expect to see at least 10% growth in sales in 2022. Broken down, 37% expect between 10-20% growth, while 21% expect more than 20% growth. Overall, 76% of respondents expect to see positive year-over-year order growth, while only 12% expect negative sales growth. 

Our latest survey also saw positive sequential demand trends with more builders reporting year-over-year sales and traffic increases in November compared to October. Anti-seasonal demand strength and confidence among builders is strong despite the now familiar headwinds caused by the tight land, labor and materials market.  

The findings are in line with the latest NAHB/Wells Fargo Housing Market Index, which came in one point higher in December at 84.  

Highlights from the latest State of the Industry Report

Sales. In November, 57% of respondents reported year-over-year sales increases compared to 42% in October and 63% in November 2020. Only 16% reported year-over-year sales decreases, compared to 23% in October and 9% year-over-year.   

Traffic. For traffic, 55% reported an increase in year-over-year traffic, while 15% reported a decline. That compares to 37% and 22%, respectively, for October. 

Expectations. Both sales relative to expectations and traffic relative to expectations increased for the second straight month, with 47% reporting sales as better than expected. That compares to 41% for October. Only 7% reported sales as worse than expected compared to 15% for October. Regarding traffic expectations, 43% said traffic was better than expected compared to 38% for October, while 9% of builders said traffic was worse than expected, up 1% from October.  

Pricing and incentives. The number of builders raising prices dipped slightly in November and remains at lower levels than the first half of the year, while the use of incentives picked up slightly. In pricing, 74% of builders raised some, most or all base prices In November from October compared to 68% last November. This percentage is down from the peak of 100% in May 2021.  

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:

Subscribe to the HomeSphere Blog Digest and keep your eye on the home building industry.

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