"Beneath those headline numbers lies a more important strategic message for homebuilding leaders navigating 2026's high-rate, high-price, high-uncertainty environment: This is a year to decide not only what to lean into but what to step away from. Less than a decade ago, Taylor Morrison deliberately expanded its geographic footprint and product mix to compete across both discretionary move-up buyers and the entry-level, first-time segment. That diversification helped power years of growth. Now, management is signaling a pivot back toward core strengths."
"CEO Sheryl Palmer framed the challenge during the earnings call, describing how different customer psychology has become across segments: When we're talking about the first-time buyer environment today, with every sale, it's really working through with them, can they make this work. When you look at the move-up and the Esplanade buyer, it's really should I They have the capabilities, they have the balance sheet. That distinction matters."
Taylor Morrison closed nearly 13,000 homes in 2025, delivering $7.76 billion in home closings revenue at an adjusted gross margin of 23.0%, generating a 13% return on equity and growing book value per share by 14%. Management identifies diverging customer psychology between first-time buyers—who require careful affordability validation—and move-up/Esplanade buyers—who have stronger balance sheets and clearer intent. Management is recalibrating strategy toward core strengths and higher-margin products. The Esplanade resort lifestyle brand gained momentum late in the year, and roughly 20 Esplanade communities are expected to open in 2026, providing a margin tailwind.
Read at www.housingwire.com
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