Two of the most persistent challenges in homebuilding both begin with the letter L.
Land.
Local approvals.
Neither factor is under a homebuilder’s control, yet both increasingly require builders to excel in management to navigate the complex equations of 2027, 2028, and 2029.
This need is particularly pressing now.
As of July, new-home inventory hit 9.6 months of supply, featuring 117,000 completed homes on the market along with another 256,000 under construction. Pricing, incentives, and profit margins are all facing pressures, while the new lots coming in to replace those being sold today demand higher costs for land, development, infrastructure, financing, and impact fees.
The implications extend far beyond current sales figures.
A land acquisition made today must align with a home that may not find a buyer for two to three years. Builders must take educated risks regarding potential buyers, their affordability, surrounding competition, suitable housing types for the area, and the speed at which local authorities will grant project approvals.
This complexity makes land one of the most challenging problems for homebuilders to solve.
Acres.com has introduced an AI-powered tool aimed at assisting builders by providing more data points before they tackle this challenge.
Understand Market Trends
Acres has launched Homebuilder Market Intelligence, an expanded version of its land-data and AI platform. This tool combines information on land and lot transfers, platting, permits, builder pipelines, listings, pricing, closings, household financial data, and various market indicators across the nation.
Its reach spans over 1,000 metropolitan and micropolitan areas and more than 3,000 counties, drawing from over 155 million parcel records and 60 million land transactions, according to Acres.
Acres aims to highlight future trends rather than just historical data, providing insight into potential developments. While closing figures reveal past actions, a competitor’s land acquisitions, platting activities, and permit applications can indicate likely future moves.
The land strategy inherently involves planning for future discrepancies. Builders make significant financial commitments today based on projections about demand, pricing, competition, and affordability in the coming years.
According to Acres founder and CEO Carter Malloy, the company has invested years in understanding the complexities behind homebuilder land ownership. Builders often acquire land through LLCs, which do not reflect the relationship to the parent company. Acres has been working to map these ownership structures back to the builders.
“We’re covering all the smaller markets across the U.S.,” Malloy stated. “This is verified data, not based on surveys. It’s actual on-the-ground verification, which is more current.”
While no dataset is flawless, he acknowledges, the benefit lies in providing access to insights that have historically been uneven, especially outside the largest housing markets.
Track the Land
An example from San Antonio supplied by Acres demonstrates the strategic advantage of this approach.
D.R. Horton ranks second in market closings but leads in land holdings with 1,500 acres, while majority-owned Forestar possesses an additional 700 acres. Over the last 24 months, Lennar acquired around 2,300 lots through land banking, whereas PulteGroup, despite accounting for about 7% of closings, made 33 land purchases compared to Lennar’s 23.
These indicators convey a different story than a simple market-share analysis.
They reveal where builders are making their next investments.
Acres can identify which entities are net buyers or sellers of land and lots, compare pricing and absorption rates, and allow users to drill down from metropolitan statistical areas (MSAs) or counties into custom-drawn regions and specific lots. For instance, Acres’ San Antonio analysis shows that two-thirds of closings were below $350,000, while only 55% of active listings fall within that range, indicating an inventory bias towards higher price points than recent transactions have indicated.
When combined, these insights transform land underwriting from merely finding an appealing parcel and calculating against current home prices into a more comprehensive analysis.
A builder can start asking questions such as: Where are competitors acquiring lots? Where are they liquidating them? Where is buyer interest declining? What price ranges are selling well? How much inventory is left in existing developments? What does local household income suggest about potential buyer capabilities?
Then comes the more challenging question.
