NVR net income falls 27% as new orders drop 7% and gross margin slips to 18.3%

NVR, Inc., a homebuilder and mortgage banker, said third-quarter net income fell 27% to $248.6 million, or $89.45 per diluted share, according to its results release dated October 22.

What happened

Consolidated revenue was $2.40 billion, against $2.61 billion a year earlier. Homebuilding revenue fell 8% to $2.35 billion. New orders decreased 7% to 4,391 homes from 4,735, and the average price of new orders was $442,100, down 5%. The cancellation rate was 21%, against 19% in the third quarter of 2025. Settlements, which are home closings, fell 7% to 5,268 homes at an average price of $445,900, down 2%.

The homebuilding gross profit margin fell to 18.3% from 21.0%. NVR said the margin was "negatively impacted by higher lot costs, pricing pressure due to continued affordability challenges and weak consumer sentiment, and by contract land deposit impairments totaling approximately $24.8 million." Pretax income from homebuilding fell 27% to $299.7 million.

Backlog and mortgage banking

Backlog of homes sold but not yet settled rose 10% in units to 10,121 and 4% in dollars to $4.59 billion as of September 30, compared with a year earlier. In mortgage banking, closed loan production fell 10% to $1.38 billion, while pretax income rose 7% to $35.0 million.

For the nine months to September 30, revenue fell 13% to $6.61 billion and net income fell 30% to $683.4 million, or $240.54 per diluted share.