Luxury Home Builder Toll Brothers Defies Housing Slump With Strong Outlook, Earnings Beat
While the economy hammers homebuilders, Toll Brothers luxury mansions remain well-insulated. The high-end developer cemented a strong quarter with a $3.50 EPS (vs. $2.84 expected) and a record-breaking $2.71B revenue — even maintaining its outlook despite broader market jitters.
- Projecting average delivery prices just shy of $1M, Toll expects to deliver 11.2K to 11.6K units this year — with CEO Douglas Yearley remaining bullish, particularly for luxury housing.
- However, land sales fell 83%, dragging its EPS below the $4.55 seen last year — while rising mortgage rates spell asymmetrical trouble for big-ticket loans.
Tale of two markets: While surged up to 6.7% on earnings, mainstream builders struggle with sluggish inventory, resorting to mortgage rate buydowns and 8% discounts to lure hesitant first-time buyers. At a median price of $416.9K, average homes remain out of reach for many Americans facing the double affordability challenge of high prices and stubborn rates. The luxury segment’s resilience proves what we’ve long suspected — when the economy squeezes, the wealthy barely notice the pinch.
