(Reuters) – Lennar Corp on Thursday reported third-quarter profit above Wall Street estimates as historically low home inventories in the market supported demand for new constructions.
Despite current mortgage rates hitting a two-decade high, existing housing supply remains tight as a majority of homeowners are locked into a fixed rate below 5%, making them unlikely to resell.
The “rate-lock in” effect has been a tailwind for homebuilders this year, even as rising home prices constrain affordability for many buyers.
“Market conditions remained constructive for new homebuilders during our third quarter,” said Lennar co-CEO Stuart Miller, adding that tight housing supply, absorbed by strong current and pent-up demand, continued to help sales.
The second-largest U.S. homebuilder’s earnings of $3.87 per share came in above analysts’ estimates of $3.51 per share, according to LSEG data.
(Reporting by Ananta Agarwal and Kannaki Deka in Bengaluru; Editing by Devika Syamnath)
