While many buyers are struggling to break into the housing market, luxury homebuilder Toll Brothers has a different angle, writes Vishaal Sanjay for Benzinga.
During its second-quarter earnings call, CEO Douglas Yearley Jr. shared insights into the Fort Washington’s company’s customer base, which leans heavily on wealthier and older buyers.
“Over 70% of our business serves the move-up and empty-nester segments,” Yearley said. “these buyers are wealthier, have greater financial flexibility, and most have equity in their existing homes.”
The average home in Toll’s backlog now sits at a record $1.13 million—with buyers spending an extra $200,000 on upgrades like design studio finishes, structural options, and premium lots. Nearly a quarter of Toll customers paid in cash this quarter, while those financing had an average loan-to-value ratio of just 70%.
Even Toll’s first-time buyers are coming with help—often through family wealth transfers, Yearley noted.
Despite broader affordability challenges—John Burns Research reports U.S. buyers are spending over 42% of income on housing—Toll posted a strong quarter with $2.71 billion in revenue and $3.50 per share in profit, beating estimates.
To read the full report and Douglas Yearley’s assessment of the Toll Brothers, visit Benzinga.
