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| Statement |
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| So when we look at the map today we feel really good about it |
| One of the key factors driving our success is the financial strength of our targeted consumer sets |
| Great results in the quarter |
| So lots of I think, sprinkles of good news that we're seeing and everything that we see today would lead us to believe it's going to be a really nice healthy spring selling season |
| Our team's strong fourth quarter execution wrapped up another tremendous year for Taylor Morrison |
| But I think we're in a healthy stabilized market and the consumer has met us more than halfway in understanding that interest rates in the 5s and 6s are really, from a long-term perspective a very good thing and they're out and so forth |
| All indicators are really strong |
| December being a company, record January continuing strong right out the gate |
| As I sit here today, I'm incredibly proud of the results we delivered in 2023, which exceeded our guidance and even more excited when I look ahead to 2024 and 2025, as we expect to continue demonstrating the earnings power of our balanced and disciplined operating platform |
| We strongly believe that our diversification across buyer groups ranging from entry-level, move-up and resort lifestyle combined with our emphasis on high-quality community locations are critical differentiators that enhance our bottom line potential, growth opportunities and risk mitigation throughout housings inevitable ebbs and flows, as demonstrated with our results through a volatile fourth quarter |
| Our top priority as we move ahead is reaccelerating our growth now that we believe that we have firmly established the operational efficiency required for outsized market share gains |
| As I said we really have had a nice start to the year |
| Our $1.8 billion land investment in 2023 was focused on supporting these growth aspirations and with one of the strongest balance sheet in our company's history we are well-positioned to continue investing with an accretive disciplined approach in 2024 and with an initial planned land spend in the range of $2.3 billion to $2.5 billion |
| Once again, I think, the good news is if I look at what those forward commitments were costing many months ago versus where we are today, it's significantly better even with the blip that we've seen this week, I still would expect over time |
| To achieve these goals we are fortunate to have the strong land development expertise that is necessary for investing in larger more efficient self-developed communities that are particularly well suited for our product and consumer portfolio |
| This strength is evident in a shift in our acquisitions away from expensive finished lots often in restrictive master planned communities by partnering with land sellers for larger self-developed parcels that offer greater margin and pace opportunity |
| I think, we've been very fortunate, and we've gotten pretty good at this navigating this environment for -- it seems like nearly two years, and I think our tools have gotten better |
| But all-in-all, we're in a much better place than we were a year ago |
| It also limits our exposure to the limited capacity of third-party land developers and improves our long-term planning visibility |
| So when you look at our ability to offer both to-be-built spec homes that are relatively equal with a relatively equal balance, when you look at us serving one-third, one-third and one-third that first-time buyer, that first and second move-up and that resort lifestyle, it really gives us an advantage in each of the markets |
| Following the sales pace of 2.8 per month in 2023, I am pleased that we expect to achieve this targeted low three sales pace goal in 2024 based on our mix of communities and the strength of the underlying market |
| In addition to driving these cycle time savings, our teams have ramped up our start volume over the past several quarters given the solid demand backdrop to ensure we have adequate inventory available |
| Each of these areas of focus improve our ability to scale our business cost effectively, offset ongoing cost inflation and deliver improved affordability and product for our homebuyers |
| Meanwhile, our innovative digital sales tools also continue to gain traction with outsized sales conversion rates nearing 50% |
| We've done a lot of operational improvements in addition to the scale that we've achieved as a company as a result of all the M&A work |
| We believe that, the strength of our core land portfolio financial health of our targeted consumers and experienced teams will allow us to navigate the uncertainties that arise while our healthy inventory levels improving cycle time and compelling sales and finance tools will allow us to meet our customers' needs |
| The healthy trends we experienced as the quarter progressed allowed us to raise base pricing in nearly 60% of communities as our teams are focused on balancing price, incentives, and pace to achieve desired sales goals and community performance |
| I am pleased that the healthy momentum continued into January and thus far in February with sales, traffic, and reservations all trending positively as the spring selling season recently kicked off |
| In addition to our financial results I'm equally proud of another important milestone, we recently earned with our ninth year as America's Most Trusted Homebuilder |
| To wrap-up, we are extremely proud of our team's 2023 performance and look forward to delivering an even stronger 2024 |
| Statement |
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| This was down from 24.4% a year ago |
| The reduced leverage was primarily due to lower home closings revenue, higher performance-based compensation expense and external broker commissions |
| In the fourth quarter approximately 56% of our sales were for spec homes similar to the prior three quarters but down slightly from the low 60% range in 2022 |
| But I think over time we certainly expect additional stabilization, which will continue to bring incentives down |
| Cancellation rates remained low at 11.6% of gross orders |
| And if I operate under the assumption that JVs are kind of tough to structure, there are not that many seller financing deals the default for more off-balance sheet is the land banking business |
| That's about 12% lower than your backlog of I think about $680,000, could you just elaborate a little bit on what's going on there? It seems even with a shift to maybe some more affordable products back, et cetera that seems a pretty meaningful shift if you will |
| And maybe just a kind of frame obviously a pretty volatile rate and cap rate environment last year maybe the last 18 months |
| I think, I vaguely remember you mentioned in 2024 you kind of had a bunch of deals in the pipeline to potentially close, but I know there's been some volatility in the SFR market the VFR market |
| What are you seeing there? And you're expecting that to be a headwind for 2024's numbers? Sheryl Palmer Yes, I'd say we saw that as a headwind actually in the back half of 2023 as I'm sure you know in 2022 we reduced commissions we reduced the base rate |
| Obviously, we've seen the volatility that's hit the market |
| These statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations and projections |
| We have seen some volatility |
| So, on the 40% of communities where you're not raising prices is it holding prices stable or having to cut pretty aggressively |
| Compared to 2023, the reduction in our average pricing partly reflects a shift towards more affordable product, particularly in our Texas and Florida markets to meet consumer needs |
| Sorry, distracting |
| Maybe not as quick as the market it assumes seeing side cuts in March or May |
| It's interesting as incent as interest rates started kind of pulling back, and we saw last -- over the last few weeks, we saw rates drop as low as kind of the mid-6s |
| And honestly it would have to really provide some strategic benefit to the organization from a geographic or scale perspective, it would have to from a product perspective may also be accretive |
| It doesn't put as much stress on the -- our trades our internal teams, et cetera |
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