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October 26, 2014

KB Home Ready to Ramp Up Production

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KB Home Ready to Ramp Up Production

Homebuilder KB Home says it plans to be aggressive in investing more than $1 billion on land acquisition this year and step up development as the housing recovery grows stronger. 

"With the backdrop of a housing recovery that is now accelerating, we feel it is the right time to step up our investment in growth," KB Home Chief Executive Jeff Mezger said on a recent conference call with analysts.

KB Home, the fifth-largest U.S. homebuilder, says it has seen its average selling prices increase for 11 consecutive quarters. Its average selling price during the first quarter increased 24 percent to $271,300, the builder’s highest first-quarter average selling price since 2006. 

KB Home says it plans to invest in higher-priced markets as demand for bigger homes picks up again. 

In the first quarter, KB Home invested about $350 million on land acquisition and development.

Last week, Lennar Corp., the nation’s third-largest U.S. homebuilder, said it plans to spend about $500 million per quarter on new land acquisitions as it also ramps up production. 

Source: “KB Home to ramp up growth amid strong housing recovery,” Reuters (March 21, 2013)

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