Tri Pointe Homes (TPH) 27 Jul 232023 Q2 Earnings call transcript

Ladies and gentlemen, greetings, and welcome to the Tri Pointe Homes Second Quarter 2023 Earnings Conference Call. At this time, all participants are in listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star and 0 on your telephone keypad.

As a reminder, this conference is being recorded. pleasure your my David now is to host, introduce Lee. It ahead. go Please

results quarter morning, Pointe results, www.tripointehomes.com the the Presentations this financial Tri welcome including and company the Events Astros the earnings its Good are to through Earlier a Homes slide and available detailing XXXX. of Documents conference deck call. released link for these under second at tab. morning, and

as call, forward-looking statements discussion which I duty factors would forward-looking materially required like that remind made Before including the on of company certain concerning uncertainties. operating to to this other involve not statements. the financial the differ begins, and call are results and and risks could statements detailed update cause Except are everyone to company's these by facts, undertakes statements historical and uncertainties that risks A future law, no actual performance, that are in filings. SEC

Keeler, Financial Mitchell, company's and turn the Officer; Operating Doug. company's Officer; the this non-GAAP of website its reconciliations to Additionally, the the Officer. through President; SEC the company's Linda Officer Chief Tri I Doug Tom and Chief the will now the Executive filings. be Chief call and Mamet, company's to financial Marketing GAAP Pointe's in Glenn Bauer, Hosting discussed on measures can are that, accessed today call most Chief measures With call comparable over

morning to and on Thank good you, call. David, everyone today's

market During operating and strategic the the discuss drivers. results for second quarter, call we update provide a operating today, will review key

the year. outlook our update of will rest we addition, In an the on provide for

was through even the the year we buyer first quarter. XX% in month. year are per part sequentially per quarter, from of over absorption XX% robust pleased the X,XXX were in saw for for new was homes second The quarter. first increased quarter, increase X.X our the resulting demand We extremely with prior the the and more second of pace an orders a home which increase Net community the results

the year sales we the of will margin call. in forward-looking and result the full expansion success, on a we raising our of detail are later more half our guidance Glenn As year. back strong the guidance give also expect into gross delivery

the delivered homes, end of selling XX% an quarter the delivery quarter increase exceeded over the active We the For market the and combination with which our XXX second communities through new year. we home opened move-in of was spec quarter, X,XXX ended a ready high conditions our prior which guidance XX strong strategy. and communities, in

building focus in locations offering. and average openings. philosophy per has communities month product resulted while diverse an executing Our been always new X.X orders This per market community of in for these base attainable community core a

year multiple persistent with fueled ago a strong current An it the XX% with is supply The new current by factors. that of all important is of momentum, that down from new new for limited market equation home supply scarcity nation-wide experiencing resale is short overall demand. levels. supply-demand component a of housing home listings housing listings, Underlying fall

to more reported As new for mortgage the financed establishing of Realtors, Association below relative construction by rate housing, inventory are resale XX% new This the reshaped demand market. dynamic National source of as borrowers the has and unique with X%. a consistent of a reliable

and structural coincides representing Z expanded demographics builders This of pricing a XX% with Along formations home their large inventory to millennials entering with to new strong We pricing selling sales market share during As its to the over as mid-X% homes the share for outpace continue and buyer of second household the Gen National same this of achieved market supply, years. with according Homebuilders. increasing quarter, market communities average the with we through in newly quarter. surge the XX% the reaching to mortgage base XX% constructed Association a of compared adjusted combination result, the increase industry at typical prices. At our to of increase time, the at net normal net lowering have incentives rates. new base were able healthy homebuying our low this consumers prime X% to

a took mortgage be loans of whose our mortgage measured being our rates. significantly company, below current X.X%, approach benefited We the market should Tri through that quarter affordability It Pointe a funded affiliate buyers mindful dynamics. of were Connect, noted second from rate

of of average with Our ratio. an an financing XX% Connect, total score household average and Pointe income $XXX,XXX, FICO Tri debt-to-income loan-to-value XX% annual XXX. representing backlog of homebuyers of our XX%

to key the initiatives operating strategic for year. Turning our

This have of. halfway talented year. is the our so every largely teams day who the point culture are at strong and We made due that company proud to excellent hard-working to the we of contribute progress

the as a to company's once work Tri place outstanding to XXXX, testament that their our been a culture. given belief again named designation a certified and XXXX to As are for Pointe has company, greatest workplace our companies great people asset,

year our focus key of teams drivers One operating on has times. reducing a the cost been this for and cycle

average products, and to designs We delivery XXXX. sold in around since focusing been reliable the of less reduction X% have continue from XXXX. more quarter supply lower is our and costs, a the normalize, to X% on of new through year able engineering negotiating more feet, this square have partners, The on material value volatility with product X,XXX resulting of of detached schedule trade a average size efficient we fourth costs seen chain existing homes

improving build reduce trade Our to team has done resources job expanding an cycle times. processes excellent and of

to in reduction time our between to completion in have now running X start efforts X months. times cycle average a frame with These resulted

our markets testament market and record of M&A growing remains Another management strategic current debt is within our through balance strength creates and XX.X%. sheet. focus and with ratio the flow. execute of to financial generate ability ended our to the is our new priority a This strong on net expansion, This disciplined a We scale cash to net capital quarter markets to financial organic entering by opportunities. flexibility strategic significant our diversification low

coupled and and pull long liquidity, value. right strong the shareholder with term runway the to teams, sheet increase operating We for our levers flexibility offer to balance is growth our believe

I'd results like of and Glenn? the for call the further to turn on discuss XXXX. rest over to some Glenn outlook quarter to the the insight provide Now our for

and good and and third our Doug, year. for some Thanks, our quarter with and highlight of quarter which our outlook the remarks the At second full highlights financial financial times, I going metrics finish expectations the will morning. I'm deck for my some deck, to slide and key is then on our website. of the operational call be our certain second information provides X quarter. from of from and posted to earnings referring results Slide

and quarter. the during excludes write-offs, percentage was of average by we an $XXX,XXX, deliver quarter revenue approximately to of impairments project advantage environment XX% home We $XXX selling as Gross delivered of the price the take of resulting homes deposit was second our XX.X% million. and XX.X% which Deliveries XXX Adjusted write-downs interest, and includes quarter. the spec came guidance X,XXX end sales high at in move-in-ready for were gross the range $XX.X in and homes for basis or margin, of above margin demand points. able million strong

As year. pricing first we experienced have some Doug power the in half mentioned, of the

in range see and quarter in to a fourth further XX% margins of of XX% to XX%. third expect in to As a gross XX% to expanded we the quarter the range result, the

better of quarter, as guidance the to compared second as percentage the fixed XX.X%, from home result our was of SG&A For was a revenue revenue. our the cost which leverage in expense a sales an increase improvement over

second the the orders the prior compared $X.XX from net which sequentially was first increase year for income quarter share. We quarter a XX% was million or generated and in an to per quarter. the diluted net Finally, new $XX X,XXX increase home XX% second

the pace Our absorption homes XX% prior X.X a increase month, community year. per per to was compared

broad-based In as D.C. all market. our pace East, by demand In normal momentum geographic region, showing footprint. terms Texas our demand strong levels. overall the as the the all X.X% demand. strong seasonal led was In color, Houston pace with Dallas, was metro West, well X.X%, of was performing markets and In outsized the above overall markets Charlotte absorption in of absorption of pace well Austin, in our X.X, Central market the absorption across with is

So far with strong seen demand month. per absorptions community July, per homes continued seasonal we in X running have X.X to

on with our community second the XX count. update We active XXX was new an An quarter which communities during year-over-year. the opened and communities, ended XX% increase selling quarter

count community to growth lots are for year which focus and new target new on XX owned next between We years. foundation still volume the solid for We provide approximately land controlled, full communities continue position XX the a the open were with in for of and several community and XXXX. on XX,XXX or to our growth

to strong liquidity with pursue opportunities fuel actively new growth. continue addition, acquisition In to our we position, future

sheet We on and flow. facility. Looking ended of and approximately quarter of at $XXX cash cash balance the and billion available revolving liquidity credit million million $X.X our of hand $XXX consisting unsecured under the with

our XX.X%. ratio net was and debt-to-capital XX.X% Our ratio was to debt net capital

million cash of million average million. land in repurchased aggregate dollar investing quarter, land of million approximately share total development. second for the For and $XXX We an from of spend we price shares generated at the X.X quarter positive during $XX a flow $XX.XX while operations per $XX

full year. third summarize to like the I'd Now our and outlook for quarter

homes we at and third average the anticipate For between an sales $XXX,XXX. X,XXX price X,XXX $XXX,XXX and quarter, between delivering

the We and percentage be XX%. expect sales in expense in gross homebuilding XX% range of revenue as to of margin anticipate XX% of home be SG&A to XX% the a to to percentage range

for in our XX%. third XX% rate the estimate effective range we be quarter to of Lastly, tax to the

a XXX,XXX our at For an XXX,XXX. increasing homes the sales delivery to are average year, price we of range between X,XXX to X,XXX guidance and full

gross be to anticipate in revenue the expense in sales to homebuilding XX.X%. and SG&A the a expect percentage range XX.X% to of of We XX.X% XX.X% range percentage be of home margin as to

call range for effective tax XX% I of be will year for to Doug the XX%. Finally, some we over closing estimate remarks. that, the the to With to in turn full rate back our

half of results year reiterate the new the I'd like homebuilding underlying closing, with the we are industry. of the In and strength to how pleased our first

foreseeable both demographics, We the into bringing homebuyers terms strong fundamentals, positive of the are the to balance into the continue in and new optimistic future about and market. which the promises supply-demand

management, opportunities. cost orders to U.S. the us both economy, deliveries, potential to strategic M&A capitalizing and We and increased navigate that uncertainties our improved grow focus through driving feel on in on any enable our while organically should returns and opportunities confident

any With With this I'd positioned shareholder Pointe enhance to it long-term that, Tri value. we to Thank the confident you. operator for outlook, like to that over continue are questions. is turn to well

Ratner the Alan [Operator Zelman The & line Instructions] Associates. with first comes of question from

morning. Hey, Thanks guys, good time. for the

demand and things for quarter pretty like the it was coming move-in I'm do So next of you give rising I on as of strategy deliveries if now. demand could anticipate And homes. like margin speaking, curious is your details in you surrounding your homes right And of spec quarters? job what just is business expectations. build your and here kind quick differentials between quick you your was mean pace there bit if specs sounds accelerating spec the ahead great starts? few your going order, strong of over forward? little as the Are to generally well this for move-in of It just mix a robust share

demand stronger We're still But Alan, seasonally you starts built. optimize demand Yes, do XX% Good to as it's levels. looking noted noted, And question. be some XX% based to seasons. we target on specs, maybe as and stay than strong, always we Doug.

So strategy. our that's that's -- been

spec. go back our started, fair of of quarter, the into second obviously, were homes the for we lot you year end our a the with went over amount half completion deliveries were in nearing As a the of -- so advanced and those that in homes guidance into

up So ended closing homes noted. you that with the as strong more demand, we

spec Alan, of Sorry, build margin we process. spec. be however, middle A little versus our that get Tom. a seem for is point it. in to of note, question. the Got on more see in the basis would most I your purchased little-- to the starts Typically, differential Alan. about This color XXX a

So we in achieving our are still revenues business. from very personalization through design studio successful homes

Tom. Great.

front. opportunities, the And while question, little lack you've you and Second frustrated expansion of Doug, still new for in with least a been that's conveying on I that been a a mentioned opportunities, M&A message looking know been past, at now. market maybe the you've the for

than over with curious of you still sphere. now have bank Just the on equity with tightening opportunities on with everything the handful quarters right next prospects the of pretty is the obviously valuations Are potentially more going moving pipeline M&A optimistic higher strong? been? you about potential looking public credit, Or

that growth. primary is Alan. At looking would some strategic that seeing in currently our markets at for a We're in opportunities say same the organic Good establishing. I of process couple we're still time, question, focus of the

to the is model Obviously, more that. know on something very So well. organic come we

So Tri Point started.

we're a, at look it's So call M&A I and to to is the bit say and capital credit the of out little to talking a the flush let's longer opportunities a pursuing, take There markets -- B of I kind as that's, I would definitely there's -- constraints. for think more bankers, system. going

the money lot are others and big of banks, banks As capital. you under center know, raising a all pressure,

markets and That's very are capitalized land the area we're developers. at, -- that too. And tight builders they're credit another so less very the for looking

you through bit a a see it's -- and longer land. as go could opportunities process there's but -- little So the where of

it year as credit to into slow to of credit continue the opportunities be -- will for land probably end towards year next markets builders slow think I and developers. down the small the to going the continue their medium-sized

you. Thank

the Stephen? Our Kim next with comes line question Stephen Evercore go of Please ISI. ahead. from

muted. was I apologize. I

Sorry about that.

And you And think, of but about the right maybe to did and you spec Tom, more a it on that? expecting, that is than you made things could lower closings. it's you Alan, close, margin were if XXX somewhat little basis you on weigh recently I ASP drove of the than that. I impact, if quarter, that I that strong something? like some did specs. that now, what just, talk just you guided or think get margin? I mentioned lower point saying a typically a assume But And gross better we then, to it mix it things think curious than was seem So I happened was a maybe specs sort have on were

spec wanted just I BTO versus clarity now. on some right So get to differential the on

I'll Glenn. There was your was the mix. they specs part guide the of heavier lower Hey average. towards and and The Stephen, in ASP it's lower pulling by Central from East ASP carry just than question. to more our company those deliveries take divisions the than quarter versus a a first due weighting our

And all the of said, started those mix year, so a that's now. a mentioned, margin, and back that And little was did just like you the then than like it bit weigh which higher related was. were also in that of Doug carried some what on the experiencing half houses cost we're currently

a there's in little the So, mix. bit of that

as that quantify you think, you would Glenn? What do

slight, not It the the the end XX margin. only out impairments, were big difference. I take points was it's of we low below you so a mean basis if

So that's all the mix.

fully that differential sales gap historical. the spec we XXX And to and that the think our studio is then, is or the bps on to demand, to from maybe actually year when Stephen, about build time. were narrow is on completion seeing design we this a I up And now, at those closer to ability typically bps And order, completed right our revenue we're XXX having units. through seeing by where little increased that are last with bit. much

positive, So are to doing teams giving health. in through getting opportunity great it's people job the them a that studio personalize our their and

to hear. Yes. and good That's very encouraging

us what is we rose out? pace a that the just pricing environment, a could could of your product So, net kind sense in expect sense pricing then in your give And types that you maybe said differential may you, with worth XQ? if there any for regarding starts, differ calling give think, starts to respect overall communities, I the could across you us how of XX% for

the I'll there we Glenn. don't between is think up, part. was able again? and of by move this board, what was the increase across able demand, product segments, take being we much to if first so that difference second question level level and entry I your affordability, a your between the approach, Stephen, but were pricing and question, of question, second were good a on then mindful was especially we the success raising industry have measured the to pricing took

Start sales.

houses in at basis starts, X,XXX roughly a started the We on and it based for us, on that market. local community-by-community second approximately for look demand we quarter and it's in

target, do. the And we X,XXX specific obviously, a us so to you've don't houses have we start but have seen ability as

will depend So it just on demand.

It starts seems like you seasonality normal to relative appropriate to about. would for be thinking be

Okay. Great. And that XQ implies in somewhat right? lighter than XQ, starts

correct. at look absorption, Yes, and orders we that's relative seasonality target as probably and to

great. Okay, much. you very Thank

you. Thank

next the comes Please of Our question from ahead. Truman Patterson go Research. Wolf line with

taking question. good my Hey, for guys. morning Thanks

million all as it So development pulled and first, $XX aggressively back believe, on and doesn't of you of all any mentioned, community bank in $XX openings. XXXX. hoping land healthy carry of to a metros, you hotel new appear year-end the kind us kind Glenn, land that I'm you peers to you through I active can have some community regions as help count, XXXX? into million growth outsized potential

Sure, question. Truman. a good That's

XXX bit of So we're and we're the communities rest community as were openings year diversify. we right depend continuing active towards year. the through XXX that little the between weighted East and forecasting this more orders and the obviously Central to go the for demand of on year. And a this will now, That by end

areas We're next previous lot on year. talked affordable more pricing, we're And those priced in adding why not entering. like of ASP communities into that. markets a of it's just because direction Texas of And seeing go mix about it's of because we've the that you're and that calls that's and Carolinas down of the

you raising bit on differently. kind little apples-to-apples where communities, the July you. question, you. in give say And of But price to a asked X% the adjustments trending were where up with were or just then metros through in Got trended of just Did following quarter? And demand? kind Steve's idea And of housekeeping range? pricing stimulate any all you X/X absorptions actually a there need pricing hopefully you hear some regions question. Got then to I any incremental to X.X% on all

are it X% was to all quarter increase. range so in average that $XX,XXX this And far. per X.X% about correct. then be smaller There's gotten quarter, pretty a smaller. that's so across or may about That's softer, just X% the that I we to And incentives broad-based think, on geographic submarkets and inventory, communities, few move things or pricing is price still average, but across standing big overall, July where area. whole a the And the power home for doing the pretty was was broad increasing based.

and luck coming Thank all in good Perfect. you quarters. the

Truman. Thanks,

Thank you.

Our of Reichardt from comes question next Carl the line BTIG. with

repurchases, looking plans $XX a X story you're now million number big repurchases diversified the add share supply think share a years? dirt new part the businesses now of do I of capital to maybe fit been and look bought How in or you to X next years improve the markets, back the It's quarter. float. kind of into for markets. at allocation reducing On But begin as this

still we our of playbook, authorization. our can under part and It's something staff and value availability it's still our have we

growth. So, we're be we're said, you continue repurchases. with Carl, like investing share in to opportunistic But going to also

is needs, playbook part we're We and have a year the our that coming sure. putting position of to next the pay ourselves capital the still for off repurchase in market on depending XX share bonds due

take the being trying Tom sort for then a in and in talked focus I to a efficiencies the I'm was And about of here. that phrase operational about of large to for ask from flu. that specifics. going release release, sort And you to

looking picture take charged drive efficiency inventory margins based just to you about you're are trying But the it I'm related turns, big somehow. or talk at. and into to there a concept that improvement to try on operational as particular numbers

Tom, or you that? Doug what expand on kind maybe, of So can mean you by

at when or turns, to mean I to better. X.X inventory goal definitely Karl. is question, Good Yes. our be comes it

more across on efficient only with in premium planned we've brand and at you efficiencies and product look reuse a a in in know, efficient, is cost providing be focused more personalization. platform, things year But but when the library reduction in our So, time. is one when able you product, still product, also operational and we providing experience of this of that much use that not still no secret, this you to cycle become our

type number that? on the working do couple So things of of add last anything we've been just of you Tom, a that's want to a kind of over years. to that

there's Yes. on just of forward. are that to I differently looking to mean, focus along enable improving a maximize the ROI we're focused outset overall. our our structure that ROI with and those deals into on deal turns, obviously, going greater really underwriting, the From teams Carl, to

Thank you. you thank much. it, so I appreciate

the from comes question with Alesia next Joe Bank. Our line of Deutsche

closings on just Just the one of upside you? downside the sources midpoint to are and thinking How me a the quick about that. for of guidance, maybe

the given factor I from going starts timing Just quarter, here at not is year. start into this point, the imagine in fiscal of second to the what you

your is about the demand and spec of kind just through talk So, the for materials? I it midpoint? to the downside the of upside about more inventory? Is selling availability it

everything first based Yes. This close the next in has Doug. going is started. is this the we're guide quarter going year. on year Good that Everything starting to close now is question. Yes, to

across pretty comfortable it. guidance, providing we'll XX hopefully, divisions, and that to feel So some we our upside have

it. Got

ASP through the on you on question. it's P&L, give maybe that is margins? the geographic will the thinking shifts. going inventory little might since going just to probably margin this about you run about cycled talk your that to that be dynamics where to you could maybe how And can land own update your bit here. that impact But been year, related medium-term or market, cycle an the these you I through us about two headwinds But return of you And if stable beyond today talked through be assuming understand the Day, long-term buyer a know a from a prior as California, function Just for you've you land expect market in maybe Investor ahead as from and mix segment is what a just shifts then now how benchmark good things.

a lot impact to there. we've is diversification and due of This our East. Joe. But in there question, is Glenn. talked about in the a Central the kind on mix Sure, ASP past, There's

XXX that, an And And expect compares year to in Obviously, year the a to where our which the that guidance ASP that's sit price way. that And so $XXX we kind next few a of can this we changes, year, impact is community if today. kind that's million range, you I could million count of, years based for of full million. our but sit good on think, $XXX the today $XXX $XXX mix. next to for benchmark in where

When to ROI strong to try to business. XX% to tends of investments. what joint we I it call on we you in kind plus metrics, target said total the really return that XX% venture for investment, returns depends lead between And market, the which is the think division return inventory but the on your your

target what that that's divisional at What the part? inventory the was so individual And that's other on we level. level. But

good and to going gross in feel and performing about now right we to question, an XX% that we've to environment? new on land Yes, said, to like a do margin, really as think, historically look XX% we've we we're forward, was the pipe in related feel it. currently Joe, and market, stabilized appropriate expect and underwrite efforts margins that And we have that's I what our in other acquisition range always as

all for color. the Thanks right. All

question RBC comes from next line Capital Mike Markets. with Our the of Dahl

your the XX.X%, you the is I'm Glenn, also When impairments of Are XQ first giving of of margins. XX.X% the guide XQ a inclusive a I plug in that or of to high year-to-date. on end question and maybe but closer I guide, out to that's backing Meramec? clarification impairments kind get exclusive

It guide, of was so GAAP impairment. inclusive the a

Got Okay. it.

a it than sense. better should that. makes That So actually impairments, ex be bit

A questions highlighted question, square in in this. things on a reduction couple of so of then X% couple footage, square footage. And Okay. costs, on the second and cost you X% reduction

is And So a part much the footage, of first you've in is communities the maybe on footage more digit the in that basis? existing second like-for-like? reduced X% cost mix square a That's that how footage within versus markets, square mid-single discussed is the that you about the already combination reduction you're when then that like-for-like part. costs. really Or think of the tailoring and like or just a bit reduction geographic is square

footage Yes, and is very good hard reduction it as convoluted X% Good square square Tom. said position in the reduction into But a Mike, markets. going our emphasis the to is maintain the of footage pull is to geographic mix attainable relative of and that from coming cognizant and questions, stronger in trying apart. portion that and this I are is a of to points Texas inclusive Carolinas. we all well, a price

of those ways to smaller and one So, key footages as we're looking drivers. get underwriting new are is at there deals, we

ahead. Go Thanks. Okay.

Thank you.

Oppenheimer. comes from the ahead. question line Batory Please Tyler next Our of with go

are couple QX? I see Do reduction, more in coming the you. morning. is Hi, questions coming good there's of on Where X I into the weeks Thank improvement half of a of there? goal improvement you me the terms progress back year, A you in the year? in think for of believe.

forth. half of so weeks pushing the year. indicated product, second the is weeks, for our of this we That anywhere division Tyla, X And end to couple Doug. improvement that and $X to million Yes, from the on year. improvements further look a does start $X depending continue to last we since the for X include X-week of the to we're in another

always for year. half in of So especially times, second cycle the there's room into improvement as we go the

mean up have relationships are are little larger, of you challenging side where of trying maintain it markets the to builders ramp with labor difficult where situation the also larger in share. things, then those bit you? some is availability. smaller the a a some of And bit you're labor of a and bit smaller. terms markets some labor And you There for In little market terms where other change there to more a Okay. any little starts. bit interested develop partners? markets presence, in you're I'm number their Is a more trade little have I

Well, is still up whenever a Raleigh, for example, where growing. our you start division, scale

few going attract to has tight more and been labor always right pandemic. have a You're the to challenges trade before retain partners. the But

is before especially but to in and force we've we're partners, the we're in experiencing able well especially the labor growth scale divisions, still Carolinas Our trade that our started up Charlotte tremendous the our pandemic with the market. got XX Texas market, aging,

scale partners and more do become you as cycle trade and up, efficient So, times. more on you as do get both said, you costs

That's it for Thank all Okay. I'll leave me. you. there.

Thanks.

Operator

you. Thank

Our of Securities. Jay Wedbush the go comes from next ahead. McCanless question with Please line

Hey, give prepared XQ in good your margin guidance morning did everyone. On, gross you comments?

I quarter. gross in XX% fourth said to XX% the margins

GAAP. Okay. impairments, including And right? That's that's

correct. That's

Okay.

The or some I what the of, can compare of was backlog percentage at we that talk sale second the like to XQ a 'XX? the say, to you negative that question And where had to had inducement of anything at do end downs end mortgage percentage about guys that does how had, enhancement gross margin buy or made? get fiscal

this is Linda. Jay, Sure,

is that that average Tri backlog for X are yes, still Pointe of the finding our we're approximately certainly, And locks. average on X.XXX%. very half rate our Connect, So points. are paid those in are backlog that incentives locks customers an They're that is customers. points for about financing that of with of helpful Currently financing at rate rate

today's rates was much around can QX it finding new down if really seem very are customers they more in the XXXX, the happy if and they with certainly with in market end because normal even are interest rates, down we're a X%. So that's from our get that from significantly that of what mid-Xs, rate comfortable

thank ‘XX. in XQ at that I Where I'm idea is any to gross to percentage for was find And of the company, percentage just at with especially that there this Linda. as is locked, ahead for end the you a of mean, Right. people rate trying you actual where the and the look margin going you have to as out benefit year. less potential

there Yes, is.

commitments the where year, second expenses. of approximately were were locks orders revenue. on the forward last in incentives And quarter rate homebuilding in expensive, Our X.X%

it incentive. end at the So like of the was more a year, X%

Okay.

for questions. Great. my Okay. Appreciate you. Thank taking

Jay. Thanks,

Thank you.

Center. of next Housing Alex comes go line Please the question Barron with ahead. Our from Research

this Good comes sales up it because terms is of to morning, that to higher as you ask is grow for at expect ASP? volume? to more been should about indicated, going wanted pace I growth going it's and the in job your to the make the pricing it we than on be as your based on great Is count point? down, everybody, in quarter. what community drop Or

Glenn. very good a is up. Go [indiscernible] follow question. ahead, I'll

good is combination, our it community growth a is and made that up that's And into with for with making it Texas. markets question. obviously, Yes, that into in going deeper revenue some, largely, count and ASP a how hopefully Okay. make plus should like expansion Carolinas but That Alex, up volume we're the is decrease. up

Doug, where are well? you comment as going to

to required opportunities would to and the goal is Carolina is add increase capital you as is divisions. understand. in efficient that Texas, much So the XX our in The market our I more on grow scale to land scale

to per more market the get overall, a but target So absorption goal the attainable mid-Xs, mid-Xs efficiencies XX X is in because and community, our points company to pricing more sale we'll scale low position, of throughout month and share X top that rates goal. our good a with is per In be will the into we get to organization. always maintain

to so threes? Absorption X.X, rate to you saying to go are X.X from the going it's

in typically exercise, we I'm of as planning No, forward attainable we points. what mid-Xs price indicating more some in a going from the these plan is plan

another Alex, seeing We're normal just more a year. seasonality this is seasonality. think normal about lot there, to Alex, thing

higher in see the do spring you pace that season. So

Okay.

Okay.

full year-to-date, year not estimate. this it's So,

That's correct.

to shift to price you homes have mix like towards as be there and always Is going stuff. also lower these spec shift towards be homes? guys going still Or you is it And done? a more a

XX%. you're well, maybe XX%, been, but in XX%, traditionally know, traditional as you We've XX% our to California, builder, spec down mix a to is

been and our homes it different still our we go personalize always customers cut-offs. as goal, their allows that's So to through

the think of you X.X%, of incentives, And in you said average it. heard Linda, Got the if terms I correctly. rate I

you to rate write to you people in you Are ago? don't months a have a need down less rate the purchase are finding necessarily that them? So, than the finding few Xs

just are because it less towards cost absolutely, and of to customers financing they're of financing. very more market closing be and They Alex, of towards This towards incentives options our becoming still current rate, using accustomed interest half using might rates, half is personalization that to important them.

real Alex, quick. Just,

say just at X.X%? clarify, You to said, you incentives did

mortgage the Yes, rate

Yes.

Okay.

as was yes. Yes, QX X.X%, Okay. mentioned. Linda Incentives orders Yes. in

Got it.

right. much. All things getting Thanks so progressively better. Okay. are Well,

Thank you.

no there closing hand questions, will further I Bauer over Douglas the for to comments. now conference As are

very the Well, with for looking call. to joining finish. strong pleased We're us thanks, very forward everybody, and today's a quarter on

forward with October. you. look everyone a great we So, to Have weekend. in Thank chatting

now has you for your Homes participation. TriPoint concluded. of conference The Thank

lines. You may disconnect your now