M/I Homes Profile
M/I Homes, Inc. and subsidiaries operate as a builder of single-family homes in the United States.
As of December 31, 2023, the company sold over 151,400 homes. The company has operations in Ohio, Indiana, Illinois, Michigan, Minnesota, North Carolina, Florida, Tennessee and Texas.
The company consists of two distinct operations: homebuilding and financial services. The company’s homebuilding operations are aggregated for reporting purposes into two reporting segments - the Northern and Southern regions. The company’s financial services operations support its homebuilding operations by providing mortgage loans and title services to the customers of the company’s homebuilding operations and are reported as an independent segment.
The company’s homebuilding operations comprise the most significant portion of the company’s business, representing 98% of consolidated revenue in 2023. The company designs, markets, constructs and sells single-family homes and attached townhomes to first-time, move-up, empty-nester, and luxury buyers. In addition to home sales, the company’s homebuilding operations generate revenue from the sale of land and lots. The company uses the term ‘home’ to refer to a single-family residence, whether it is a single-family home or attached home. The company uses the term ‘community’ to refer to a single development in which the company constructs homes. At times, ‘multiple communities’ can exist in a single development where the company offers multiple product types. The company primarily constructs homes in planned development communities and mixed-use communities. The company is offering homes for sale in 213 communities within 17 markets located in ten states.
The company’s financial services operations generate revenue primarily from originating and selling mortgages and collecting fees for title insurance and closing services. The company offers mortgage banking services to its homebuyers through the company’s 100%-owned subsidiary, M/I Financial, LLC (‘M/I Financial’). The company offers title services through subsidiaries that are 100%-owned by the company.
M/I Financial originates mortgages, primarily for the company’s homebuilding customers. M/I Financial sells a portion of the loans originated on a servicing released, non-recourse basis, although M/I Financial remains liable for certain limited representations and warranties related to loan sales and for repurchase obligations in certain limited circumstances.
Business Strategy
The company is focused on maximizing profitability, continuing to expand the company’s market share using its more affordable designs and being selective in land and land development investment opportunities.
Sales and Marketing
In 2023, the company continued to focus its marketing efforts on first-time and move-up homebuyers, including home designs targeted to first-time, millennial, multi-generational and empty-nester homebuyers. The company markets and sells its homes under the M/I Homes brand.
The company provides its homebuyers with the following products, programs and services, such as homes with high quality construction located in attractive areas and desirable communities that are supported by the company’s 10-year transferable structural warranty; the company’s Whole Home Building Standards, which are designed to deliver features and benefits that satisfy the buyer’s expectation for a better-built home, including a more eco-friendly and energy efficient home that will generally save the company’s customers up to 30% on their energy costs compared to a home that is built to minimum code requirements; the company’s onsite and online Design Studios and Design Consultants that assist its homebuyers in selecting product and design options; fully furnished model homes and highly-trained sales consultants to build the buyer’s confidence and enhance the quality of the homebuying experience; the company’s mortgage financing programs that the company offers through M/I Financial, including competitive fixed-rate and adjustable-rate loans; the company’s Ready Now Homes program, which offers homebuyers the opportunity to close on certain new homes in 90 days or less; and the company’s unwavering focus on customer care and customer satisfaction.
To further enhance the homebuying process, the company operates Design Studios in some markets. The company’s Design Studios allow its homebuyers to select from a variety of product and design options that are available for purchase as part of the original construction of their homes. The company’s centers are staffed with Design Consultants who help its homebuyers select the right combination of options to meet their budget, lifestyle and design sensibilities. In most of the company’s markets, the company offers its homebuyers the option to consider and make design planning decisions using the company’s Online Design Center. This tool is helpful for prospective buyers to use during the planning phase and makes their actual visit to the company’s Design Studios more productive and efficient as the company’s Design Consultants can view the buyer’s preliminary design selections and pull samples in advance of the buyer’s visit.
The company also invests in designing and decorating fully-furnished and distinctive model homes intended to create an atmosphere reflecting how people live today and help the company’s customers imagine the possibilities for a ‘home of their own, just the way they dreamed it’. The company carefully selects the interior decorating and design of its model homes to reflect the lifestyles of the company’s prospective buyers.
As of December 31, 2023, the company employed 240 home sales consultants.
The company also offers specialized mortgage financing programs through M/I Financial to assist its homebuyers. The company offers conventional financing options along with programs offered by the Federal Housing Authority (‘FHA’), the U.S. Veterans Administration (‘VA’), the United States Department of Agriculture (‘USDA’) and state housing bond agencies. M/I Financial offers the company’s homebuyers ‘one-stop’ shopping by providing mortgage and title services for the purchase of their home, which saves its customers both time and money. With respect to title services, the company’s title subsidiaries work with its homebuilding divisions so that the company is able to provide an organized and efficient home delivery process.
The company also builds inventory homes in most of its communities to offer homebuyers the opportunity to close on certain new homes in 90 days or less.
The company markets its homes using digital and traditional media. The company markets directly to consumers via newspaper, direct mail, billboards, radio, and television, as well as internet marketing using the company’s website, search engine optimization, paid search, and display advertising. The company leverages its presence on referral sites, such as Zillow.com, Realtor.com, and NewHomeSource.com, to drive sales leads to the company’s internet sales managers. The company also uses email marketing to maintain communication with existing prospects and customers. The company uses its social media presence to communicate to potential homebuyers the experiences of customers who have purchased the company’s homes and to provide content about its homes and design features.
Product Lines, Design and Construction
The company’s residential communities are generally located in suburban areas that are easily accessible through public and personal transportation. In addition to single-family detached homes, the company offers attached townhomes in several of its markets.
The company devote significant resources to the research, design and development of its homes to meet the demands of the company’s buyers and evolving market requirements. The company regularly reviews the plans offered in each of its divisions to ensure that the company’s home designs are still relevant and appropriate for that particular market. Across all of the company’s divisions, the company offers over 500 different floor plans designed to reflect current lifestyles and design trends.
The company also continues to develop new floor plans and communities specifically for the growing empty-nester market. These plans (primarily ranch and main floor master bedroom type plans) focus on move-down buyers, are smaller in size, and feature outdoor living potential, fewer bedrooms, and improved community amenities. The company’s homebuilding divisions often share successful floor plans with other divisions, when appropriate.
The company continues to look for opportunities to develop more multi-family communities. In some cases where commercial and office developments are in less demand, the company sees potential to rezone to a higher density multi-family solution.
The company continues to increase its multi-family Smart Series offerings in several of the company’s divisions. These Smart Series townhome programs are thoughtfully designed and intended to be more affordable and take advantage of higher density opportunities either as stand-alone communities or as part of the company’s conventional Smart Series single-family neighborhoods.
The company’s ‘City Collection’ floor plans offer a unique and upscale urban lifestyle by utilizing narrow lots, detached rear garages and thoughtfully designed interiors. The company’s City Collection enables the company to participate in new infill development opportunities that extend beyond its suburban markets.
The company designs all of its product lines to reduce production costs and construction cycle times while adhering to the company’s quality standards and using materials and construction techniques that reflect the company’s commitment to more environmentally conscious homebuilding methods. Some of those techniques include wall, floor, and roof panelization to minimize waste, as well as construction waste recycling. The company also strives to maximize greenspace, develop in environmentally harmonious communities, build energy efficient homes, and purchase sustainable inputs. All of the company’s homes are constructed according to proprietary designs that meet the applicable FHA and VA requirements and all local building codes. The company attempts to maintain efficient operations by utilizing standardized materials.
The company’s homes are constructed according to standardized prototypes, which are designed and engineered to provide innovative product design. The company’s construction process, and the construction cycle times resulting from its product line design, generally reduce the time the company’s subcontractors and vendors spend transporting labor, equipment, and materials to and from the company’s communities, as well as the environmental impact and carbon emissions associated with the construction of the company’s homes. The company generally employs subcontractors to install site improvements and construct homes.
Financial Services
The company sells its homes to customers who generally finance their purchases through mortgages. M/I Financial provides the company’s customers with competitive financing and coordinates and expedites the loan origination transaction through the steps of loan application, loan approval, and closing and title services. M/I Financial provides financing services in all of the company’s housing markets.
M/I Financial has been approved by the U.S. Department of Housing and Urban Development, FHA, VA and USDA to originate mortgages that are insured and/or guaranteed by these entities. In addition, M/I Financial has been approved by the Federal Home Loan Mortgage Corporation (‘Freddie Mac’) and the Federal National Mortgage Association (‘Fannie Mae’) as a seller and servicer of mortgages and as a Government National Mortgage Association (‘Ginnie Mae’) issuer. The company’s agency approvals, along with a sub-servicing relationship, allow the company to sell loans on either a servicing released or servicing retained basis. This option provides flexibility and additional financing options to the company’s customers.
The company also provides title and closing services to purchasers of the company’s homes through the company’s 100%-owned subsidiaries, TransOhio Residential Title Agency Ltd., M/I Title Agency Ltd., and M/I Title LLC. Through these entities, the company serves as a title insurance agent by providing title insurance policies and examination and closing services to purchasers of the company’s homes in all of its housing markets except for North Carolina and Nashville. TransOhio Residential Title Agency Ltd. provides examination and title insurance services to the company’s housing markets in the Raleigh and Charlotte markets.
Government Regulation and Environmental Matters
The company’s mortgage company and title insurance agencies are subject to various local, state and federal statutes, ordinances, rules and regulations (including requirements for participation in programs offered by FHA, VA, USDA, Ginnie Mae, Fannie Mae and Freddie Mac).
Seasonality
The company’s homebuilding operations have historically experienced significant seasonality and quarter-to-quarter variability in homebuilding activity levels. In general, homes delivered increase substantially in the second half of the year (year ended December 2023). This seasonality reflects the tendency of homebuyers to shop for a new home in the spring with the goal of closing in the fall or winter, as well as the scheduling of construction to accommodate seasonal weather conditions. The company’s financial services operations also experience seasonality because their loan originations correspond with the delivery of homes in the company’s homebuilding operations.
History
M/I Homes, Inc. was founded in 1976.
