Luxury homebuilder Toll Brothers Inc.'s sales improved this year in part because it caters to high-income earners who tend to be in a better financial position to buy a home than other potential buyers. But even the more affluent buyers can be put off by the uncertainty in the economy and wild swings in the stock market.
So are luxury homebuyers still spending big on optional home upgrades? Or have they pulled back?
CEO Douglas Yearley says Toll Brothers' customers are taking longer to make a home purchase, but once they do, they're not skimping on the extras.
QUESTION: Can you give us any update in terms of the kind of options people have been choosing? Have you seen anything change meaningfully there over the last few quarters?
RESPONSE: No. We continue to be happy and impressed that while it may take a buyer a little bit longer to press firmly and agree to buy, once they do, they load the house up with just as many options as they did in those glorious days of '03, '04, '05. We're still selling about $110,000 per house in upgrades, and so that's good news through this downturn. The buyers may be a little more cautious, but once they buy, they still want all the bells and whistles, and we make sure to offer all of that.
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