Toll Brothers is planning to launch a new line of lower-priced homes that will be aimed at the growing number of millennial homebuyers entering the market, company CEO Douglas Yearley said on a conference call Dec. 6.
The T|Select line of homes will be designed with fewer structural options and upgrades than the Pennsylvania-based homebuilder typically offers, which is expected to provide quicker delivery times and a slightly lower price.
The line will launch in January in Houston and is set to expand into three or four communities, Yearley said. The company offers homes similar to T|Select in markets including Jacksonville, FL, and Boise, ID.
Toll Brothers is looking to cash in on the expected rise in younger first-time buyers entering the market as tight credit conditions ease slightly and rents continue to rise. Millennials are expected to account for 33% of homebuyers next year, while baby boomers should account for 30%, Realtor.com reported in its 2017 Housing Forecast.
In its fourth-quarter earnings released this week, Toll Brothers reported that 22% of its developments included one primary buyer 35 years of age or under in its fiscal year 2016. The company is targeting this group with a mix of inventory including single-family suburban homes, urban condos and rental apartments, in addition to the forthcoming T|Select line. The company told Construction Dive it is not yet sharing details about the new line beyond what was disclosed in the conference call.
Toll Brothers isn’t alone in its focus on the growing segment, with Meritage Homes launching its LiVE.NOW. homes in October. The single-family houses range from 1,800 square feet to 2,500 square feet, and are priced from the low $200,000s. The line launched in Houston and Phoenix.
The decision by Toll Brothers to launch its new affordable product line in Houston further highlights the current residential construction boom in the city amid growing demand driven by healthy employment levels and low housing costs.
Canada-based developer Empire Continental Land this week announced that it has started work on a 206-acre, 540-home site in League City, TX, which is located southeast of Houston.
For more housing news, sign up for our daily residential construction newsletter.