March 16 (Reuters) - Lennar Corp beat quarterly
profit estimates on Tuesday as historically low mortgage rates
and a COVID-19 pandemic-induced shift to suburban living
encouraged more Americans to buy homes.
The housing market has been one of the persistent bright
spots throughout the coronavirus-driven recession. However, it
faces prospects of a slowdown as mortgage rates rise on the back
of a surge in U.S. Treasury yields.
Lennar estimated second-quarter orders -- an indicator of
future sales -- between 16,500 homes and 16,700 homes, above
analysts' estimates of 16,240 homes, helped in part by a
shortage of previously owned houses on the market.
"A combination of still low interest rates, strong personal
savings rates during the pandemic, strong stimulus from the
government, and solid household formation continue to drive
demand," Executive Chairman Stuart Miller said.
The Miami, Florida-based homebuilder's shares were 1% higher
in extended trading, having gained over 16% so far this year.
But Lennar's delivery forecast of between 14,200 homes and
14,400 homes was below expectations of 15,067 homes, as land
constraints and soaring lumber prices limit homebuilding
The company's profit jumped more than two-fold in the first
quarter to $1 billion, buoyed by a one-time gain of $469.7
million related to its investment in online real estate firm
Opendoor Technologies Inc, which went public in
Excluding that, profit was $2.04 per share, higher than
analysts' estimates of $1.71 per share, according to Refinitiv
Orders surged 25.8% to 15,570 homes, while the number of
homes sold jumped 19.3% to 12,314.
Revenue rose 18% to $5.33 billion.
(Reporting by Shreyasee Raj in Bengaluru; Editing by Aditya