Steve Hilton, the CEO and founder of the 7th-largest home builder in country, flipped luxury home builder Meritage Homes upside down a few years ago, turning them into one of the largest entry-level spec builders in the country. That spec strategy (build the home before it is sold) has helped Meritage tremendously this year. They were priced right and didn’t get caught without ready-to-move-in homes to sell, as many other builders did.
Steve shares his thoughts with host Dean Wehrli on the cultural transition he went through, the ups and downs of 2020, and the strategic importance of Meritage’s pioneering investments in energy efficiency.
Like most, 2020’s boom, bust, and then bigger boom caught Steve off guard. However, he is now calling this the perfect storm for home builders. His customers are taking advantage of:
- the lowest mortgage rates in history, which are very important to Meritage’s payment-focused buyers
- a societal shift back toward more home buying in suburban locations, where there is more elbow room and where Meritage can build and sell more homes
Steve also discusses how his team has addressed the national lot shortage by developing their own lots. While land development is a riskier business than home building, Meritage handles that risk by paying down debt to the point where their balance sheet has never been stronger and purchasing the land in phases whenever possible.
Enjoy the words of wisdom from Steve Hilton and Dean Wehrli.
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