NVR, Inc., one of the nation’s largest homebuilding and mortgage banking companies, reported a net income of $400.9 million, or $120.69 per diluted share, for the second quarter ending June 30, 2024. This marks a 1% decrease in net income compared to $404.0 million, or $116.54 per diluted share, in the second quarter of 2023. However, diluted earnings per share increased by 4%. Consolidated revenues for the second quarter of 2024 reached $2.61 billion, reflecting a 12% increase from $2.34 billion in the same quarter of 2023.
For the first half of 2024, consolidated revenues totaled $4.95 billion, a 10% rise from $4.52 billion during the same period in 2023. Net income for the six months ended June 30, 2024, was $795.2 million, representing a 6% increase compared to $748.4 million for the same period in 2023. Diluted earnings per share for the first half of 2024 rose 9% to $237.05, up from $216.52 for the same period in 2023.
Homebuilding
In the second quarter of 2024, new orders rose by 3% to 6,067 units, up from 5,905 units in the second quarter of 2023. The average sales price of new orders was $458,800, a 3% increase compared to the previous year. The cancellation rate for the second quarter of 2024 was 13%, up from 11% in the same quarter of 2023. Settlements increased by 11% to 5,659 units, compared to 5,085 units in the second quarter of 2023, while the average settlement price remained stable at $450,200.
As of June 30, 2024, the backlog of homes sold but not settled rose by 3% in units to 11,597 and by 6% in dollar value to $5.45 billion compared to the same date in 2023.
Homebuilding revenues for the second quarter of 2024 totaled $2.55 billion, an increase of 12% from $2.28 billion in the same quarter of 2023. The gross profit margin decreased slightly to 23.6%, down from 24.3% in the second quarter of 2023. Income before tax from the homebuilding segment was $488.5 million, representing a 12% increase from the prior year.
Mortgage Banking
Mortgage closed loan production in the second quarter of 2024 amounted to $1.53 billion, an 11% increase compared to the second quarter of 2023. Income before tax from the mortgage banking segment reached $45.0 million, a 23% rise from $36.5 million in the second quarter of 2023, primarily driven by increased secondary marketing gains from loan sales.
Effective Tax Rate
The effective tax rate for the three and six months ended June 30, 2024, was 24.9% and 20.8%, respectively, compared to 14.3% and 17.3% for the same periods in 2023. The increase in the effective tax rate is largely due to a lower income tax benefit recognized for excess tax benefits from stock option exercises, which were $6.8 million and $50.6 million for the three and six months ended June 30, 2024, respectively, compared to $55.9 million and $79.2 million for the three and six months ended June 30, 2023, respectively.
