NVR Profile
NVR, Inc. engages in the construction and sale of single-family detached homes, townhomes and condominium buildings, all of which are primarily constructed on a pre-sold basis. To more fully serve customers of its homebuilding operations, the company also operates a mortgage banking and title services business. The company conducts its homebuilding activities directly.
The company’s mortgage banking operations are operated primarily through a wholly owned subsidiary, NVR Mortgage Finance, Inc. (NVRM). The company is one of the largest homebuilder in the United States. The company operates in thirty-six metropolitan areas in fifteen states, and Washington, D.C. The company’s homebuilding operations include the construction and sale of single-family detached homes, townhomes and condominium buildings under three trade names: Ryan Homes, NVHomes and Heartland Homes.
The company’s Ryan Homes product is marketed primarily to first-time and first-time move-up buyers. Ryan Homes operates in thirty-six metropolitan areas located in Maryland, Virginia, Washington, D.C., Delaware, West Virginia, Pennsylvania, Ohio, New York, New Jersey, Indiana, Illinois, North Carolina, South Carolina, Georgia, Florida and Tennessee. The company’s NVHomes and Heartland Homes products are marketed primarily to move-up and luxury buyers. NVHomes operates in Delaware, New Jersey, and the Washington, D.C., Baltimore, Maryland (MD) and Philadelphia, Pennsylvania (PA) metropolitan areas. Heartland Homes operates in the Pittsburgh, PA metropolitan area.
In addition to building and selling homes, the company provides a number of mortgage-related services through its mortgage banking operations. Through operations in each of its homebuilding markets, NVRM originates mortgage loans almost exclusively for the company’s homebuyers. NVRM generates revenues primarily from origination fees, gains on sales of loans and title fees. NVRM sells almost all of the mortgage loans it closes into the secondary markets on a servicing released basis.
Homebuilding
Products
The company offers single-family detached homes, townhomes and condominium buildings with many different home designs. These home designs have a variety of elevations and numerous other options. The company’s homes combine traditional, transitional, cottage or urban exterior designs with contemporary interior designs and amenities, generally include two to four bedrooms and range from approximately 1,000 to 10,000 finished square feet.
Markets
The company’s four homebuilding segments operate in the following geographic regions:
Mid Atlantic: Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
North East: New Jersey and Eastern Pennsylvania.
Mid East: New York, Ohio, Western Pennsylvania, Indiana and Illinois.
South East: North Carolina, South Carolina, Tennessee, Florida and Georgia.
Construction
The company utilizes independent subcontractors under fixed price contracts to perform construction work on its homes. The company uses many independent subcontractors in its various markets.
Sales and Marketing
The company’s preferred marketing method is for customers to visit a furnished model home featuring many built-in options and a landscaped lot. The garages of these model homes are usually converted into temporary sales centers where alternative facades and floor plans are displayed and designs for other models are available for review. Sales representatives are compensated predominantly on a commission basis.
Mortgage Banking
The company provides a number of mortgage related services to its homebuilding customers through its mortgage banking operations. The company’s mortgage banking operations also include separate subsidiaries that broker title insurance and perform title searches in connection with mortgage loan closings for which they receive commissions and fees. Because NVRM originates mortgage loans almost exclusively for the company’s homebuilding customers, NVRM is dependent on the company’s homebuilding segment. In 2023, NVRM closed approximately 15,900 loans.
NVRM sells almost all of the mortgage loans it closes to investors in the secondary markets on a servicing released basis, typically within 30 days from the loan closing. NVRM is an approved seller/servicer for Fannie Mae (FNMA) and Freddie Mac (FHLMC) mortgage loans and an approved seller/issuer/servicer of Ginnie Mae (GNMA), Department of Veterans Affairs (VA) and Federal Housing Administration (FHA) mortgage loans.
Regulation
NVRM is subject to the rules and regulations of FNMA, GNMA, FHLMC, VA and FHA. These rules and regulations restrict certain activities of NVRM. NVRM is currently eligible and expects to remain eligible to participate in such programs. In addition, NVRM is subject to regulation at the state and federal level, including regulations issued by the Consumer Financial Protection Bureau (the CFPB) with respect to specific origination, selling and servicing practices.
Properties
In connection with both its homebuilding and mortgage banking businesses, the company also leases office space in multiple locations for homebuilding divisional offices and mortgage banking and title services branches under leases expiring at various times through 2030, none of which are individually material to its business.
In connection with the operation of the homebuilding business, the company leases production facilities in the following seven locations: Thurmont, Maryland; Burlington County, New Jersey; Farmington, New York; Kings Mountain, North Carolina; Darlington, Pennsylvania; Portland, Tennessee; and Richmond, Virginia. These facilities range in size from approximately 40,000 square feet to 400,000 square feet and total approximately one million square feet. Each of these leases contains various options for extensions of the lease and for the purchase of the facility. Additionally, certain facility leases have early termination options. These leases currently expire between 2027 and 2040. The company has entered into lease agreements for new production facilities in Fayetteville, North Carolina and Lavonia, Georgia. The Fayetteville facility will be approximately 145,000 square feet with a lease term of 10 years from the commencement date, which is expected to be in the first quarter of 2024, and contains an option for three five year extensions. The Lavonia facility will be approximately 170,000 square feet with a lease term of 15 years from the commencement date, which is expected to be later in 2024, and contains an option for four five year extensions. In addition, the company owns a production facility of approximately 100,000 square feet in Dayton, Ohio. The company’s plant utilization was 56% and 58% of total capacity in 2023 and 2022, respectively.
History
NVR, Inc. was founded in 1980.
