Since the recent economic troubles, home building projects have
slowed as many individuals are obviously uncertain about what the
future holds for their real estate investments. Now, it is apparent
that according to the luxury-home building firm, Toll Brothers,
this Spring of 2012 represented their best performance for selling
homes in any Spring market over the past five years.
With a profit of $16.9 Million accounting for a $0.10 increase
per share, Toll Brothers first quarter of this year far and away
out did the previous years first quarter. The same corresponding
months for 2011 had Toll Brothers with results that saw them
realize a loss of $20.8 Million, representing a $0.12 decrease per
share. Moreover, this year their revenue also jumped 17% to $373.7
Million for the first quarter.
A Pensylvannia-based Toll Brothers revealed a 51% boost in
signed contracts that correlates to 1,290 units totalling $754.7
Million. Furthermore, deliveries were up as well by 14% to 671
units and of these net signed contracts the average price per unit
was fairly consistant with the first quarter of 2011, holding at or
around $585,000.
The past six months is where the most drastic housing recovery
improvements have occured. As the first quarter came to an end, it
was found that Toll Brothers had a backlog of 2,403 units that are
worth $1.5 Billion. This ultimately is a rise of 37% in units and
49% in total dollars when compared to the final calculated results
from the same first three months of 2011.
So what does the CEO, Douglas Yearley Jr., feel is the main
reason for such an optimistic turnaround of late? Much of it can be
drawn from the historically low mortgage rates and the lack of
inventory in the market. Toll Brothers shareholders are also seeing
their stock up by roughly 30% so far in 2012 as well largely
because of these two factors. Evidently, things in the Real Estate
business are picking up and only look to continue to press on as we
go forward this year and for years to come.
More Information: Fox Business