BLOOMFIELD HILLS, Mich. (AP) — The country's growing demand for new homes propelled PulteGroup Inc. back to a first-quarter profit, the homebuilder said Thursday.
Homebuilders took a big hit during the Great Recession and the years that followed, but the rebound in the housing market that began last year has helped companies like PulteGroup return to profitability.
The company, one of the country's largest homebuilders, is seeing strong demand as the spring home-buying season heats up, with higher traffic and a "greater sense of urgency" from potential buyers due to the limited supply of homes and rising prices, said CEO Richard Dugas.
Demand for homes, more than six years after the housing bubble burst, is growing due to steady job creation and very low mortgage rates. A low inventory of homes for sale has helped drive more construction of new homes and has also helped boost prices.
The Bloomfield Hills, Mich.-based company said Thursday that the number of homes it closed on during the quarter rose 23 percent 3,833, while the average selling price was up 10 percent to $287,000. New orders rose 4 percent to 5,200.
Its net income came to $81.8 million, or 21 cents per share, in the January-March period, compared with a loss of $11.7 million, or 3 cents per share, in the same months of 2012.
Revenue jumped 32 percent, to $1.16 billion from $881 million.
Analysts, on average, expected a profit of 16 cents per share on $1.17 billion in revenue, according to FactSet.
PulteGroup also said Thursday that it will use some of the cash it has to redeem $399 million in debt.
PulteGroup shares dipped 9 cents to $19.60 in premarket trading. The stock has more than doubled in the past 12 months.