Lennar reports strong home sales despite market challenges

Lennar, a major homebuilder, held its first quarter earnings call for 2025 today. The company discussed its performance for the last quarter of 2024, highlighting a challenging housing market due to high mortgage rates and consumer confidence issues. During the call, Lennar's leaders outlined strategies to maintain consistent home sales and production while managing costs. Chief Executive Stuart Miller noted that despite a decline in average sales price to $408,000, the company's focus on volume and cash flow remains strong. Miller emphasized that the housing market's current state has led to slowing demand and the need for increased incentives, which now average 13%. He stated that while margins have been affected, Lennar's focus on an asset-light model will allow the company to reduce costs over time. Operationally, the company reported starting 17,651 homes and delivering 17,834 homes in the first quarter. Keller's leaders expressed optimism about meeting their target of delivering between 86,000 and 88,000 homes in 2025. The company's balance sheet remains strong, ending the quarter with $2.3 billion in cash. They also made significant stock repurchases and paid dividends, with plans to continue returning capital to shareholders. Looking ahead, Lennar expects to deliver between 19,500 and 20,500 homes in the second quarter of 2025 and anticipates margins to be around 18%. They are optimistic about navigating the current challenges and are confident in their ability to adapt to changing market conditions.