Smith Douglas Homes reported record third quarter home closings and is on pace to achieve approximately 18% annual growth in closings for the 2024 fiscal year.

“Our team’s commitment to our core operational strategies—offering home buyers a personalized buying experience, working closely with suppliers and trade partners for an efficient production cycle, and maintaining a land light balance sheet—continues to deliver strong results,” vice chairman and CEO Greg Bennett said.

Home closings increased 39% year-over-year to 812 in the third quarter, helping drive 41% growth in home closing revenue to $277.8 million. Smith Douglas reported an average sales price on homes closed of $342,000 in the third quarter, an increase of $3,000 compared to the third quarter of 2023.

The builder’s cancellation rate remained in line with recent quarters, at 11.4%.Net new home orders increased 6% year-over-year to 600 in the third quarter. The average sales price of orders in the period was also $342,000, a $1,000 increase compared to the third quarter of 2023.

During the builder’s earnings call, Bennett said Smith Douglas experienced some variations in orders due to movement in mortgage rates, though constrained resale supply, strong local economies, and steady growth in household formation supported positive demand trends in the builder’s markets of operation. Bennett said some buyers remained hesitant in the period due to election uncertainty and expectations that rates would decline further; however, he said Smith Douglas remains optimistic that much of the macroeconomic uncertainty will be resolved by the spring selling season of 2025.

“We believe we are in a great position to achieve our delivery goals for the year and carry that momentum into 2025,” Bennett said during the earnings call. “Cycle times are back to their pre-COVID levels in most markets and, in some instances, are even better. We have a number of communities scheduled to open ahead of the spring selling season that we believe will help us drive sales [and] we have the advantage of offering some of the most affordably priced homes of any of the publicly-traded home builders.”

During the quarter, the No. 36 company on the 2024 Builder 100 list further expanded its operations into Greenville, S.C. Bennett said the company hired a new division president for Greenville and has five land deals under contract, with lot deliveries projected for early 2026. He said Atlanta and Alabama remain Smith Douglas’s biggest markets; the builder plans to continue to expand deliberately, targeting markets with long-term growth prospects that fit within the company’s operation strategy.

“[We continued] to build our infrastructure in central Georgia and Chattanooga, Tennessee,” executive vice president and chief financial officer Russ Devendorf said. “This strategic growth reflects our commitment to meeting demand for quality homes in the southeastern and southern United States.”

At quarter’s end, Smith Douglas had 18,878 total controlled lots, a 54% increase compared to the prior-year period. Of the company’s controlled lots, 16,132 were controlled via option.

The builder had 74 active communities compared to 62 at the end of the third quarter in 2023. Additionally, the company had 961 homes in backlog at the end of the quarter, down from 1,042 at the end of the third quarter in 2023.

During the period, Smith Douglas reported an 11.5% growth in profit to $37.8 million. The builder’s profit per share in the third quarter was $0.58.