Homebuilder Lennar Slashes Prices 30 Percent From Pandemic Peak

Lennar, the second-largest U.S. homebuilder, has slashed home prices 30 percent from its pandemic peak, new research shows.

New data gathered by Reventure App CEO Nick Gerli from Securities and Exchange Commission filings shows Lennar’s net average selling price on new orders fell to $359,000 in the third quarter.

This is down sharply from the record $511,000 logged in the second quarter of 2022.

“Lennar is cutting prices so much that their current [average selling price] on new orders is below pre-pandemic levels,” Gerli wrote in a Sept. 17 post on X.

“They’re achieving this through outright price cuts, mortgage rate buydowns, and smaller floor plans.”

The overall homebuilding sector has lowered gross prices by almost 15 percent from 2022 to 2026.

This is good news for prospective homebuyers but bad news for resellers, Gerli added.

While national home prices are slightly down from the post-crisis high, they are firmly above their pre-pandemic levels, according to Census Bureau figures.

Since the fourth quarter of 2022, the median sales price of new houses sold in the United States has declined about 7 percent to below $411,000.

Lennar said in its third-quarter earnings report on Sept. 17 that homebuyers are “clearly stretching” to afford purchasing a home, citing rising mortgage rates and stubborn inflation.

Third-quarter profits were cut in half, coming in below $284 million.

“When families are paying more at the pump and more for electricity, their willingness to make the largest financial commitment of their lives moderates, even when their underlying desire to own has not changed at all,” Stuart Miller, president and CEO, said in an earnings call.

Year-to-date, shares of Lennar are down almost 26 percent.

Homebuilder sentiment tumbled to a one-year low this month amid higher mortgage rates, increasing material costs, and labor shortages, according to the National Association of Home Builders-Wells Fargo Housing Market Index released on Sept. 16.

Interest Rates Influencing American Dream

Despite the modest drop in U.S. home prices, surging interest rates could limit demand heading into the fall buying season.

In the four weeks ending Sept. 13, pending home sales slumped almost 4 percent to their lowest level in almost three years, according to Redfin.

Daily showing activity—as of Sept. 10—also fell 3 percent from the start of the year, compared to the 26 percent increase in 2025.

Mortgage application volumes fell more than 4 percent last week as both applications for new home purchases and refinancing fell, according to the Mortgage Bankers Association.

“After adjusting for the Labor Day holiday, purchase applications dipped relative to the week prior as higher mortgage rates caused many buyers to pause their purchase decisions,” Joel Kan, the group’s vice president and deputy chief economist, said in a statement.

Mortgage rates have surged over the past month amid climbing Treasury bond yields.

The benchmark 10-year yield, which influences a wide range of borrowing costs, is hovering around 5 percent, the first time since 2023.

A plethora of factors have lifted government bond yields across the board in recent weeks, including war-driven persistent inflation risks, growing expectations of the Federal Reserve raising interest rates, and greater capital competition.

Mortgage rates have risen to levels not seen in more than a year.

As of Sept. 17, the average 30-year fixed mortgage rate is 7.19 percent, up from 5.99 percent before the U.S.–Iran conflict in late February.

Higher borrowing costs could be on the horizon as the Federal Reserve signaled this week that another interest rate hike could be on the table.

After the Fed followed through on the widely expected quarter-point increase on Sept. 16, the Fed released its Summary of Economic Projections.

The quarterly outlook for policy and the economy suggested that at least one more 25-basis-point move is on the table.

“Inflation is too high and has been for too long,” Fed Chairman Kevin Warsh told reporters after the Federal Open Market Committee policy meeting.

At the same time, tighter monetary policy could actually stabilize interest rates, says Jeff DerGurahian, head economist at loanDepot.

“If investors believe the move will contain inflation rather than mark the beginning of a long series of increases, mortgage rates could remain steady or even move lower,” DerGurahian said in a note emailed to The Epoch Times.

“It may sound counterintuitive, but when markets already expect the hike, the message accompanying it can matter more than the move itself.”

Current market conditions could also benefit prospective homebuyers.

“Homebuyers who remain in the market may have more negotiating power than the headline mortgage rate suggests,” DerGurahian said, adding that the current environment can create opportunities to negotiate price or pursue concessions that could outweigh the monthly mortgage payment difference.

New home listings are up nearly 2 percent year over year, and sellers outnumbered buyers by 58 percent last month.

Redfin research released on Sept. 18 also shows that home sellers gave concessions to buyers in nearly 45 percent of home sales in August, the highest share for that month since 2020.