Toll Brothers CEO Douglas Yearley said on CNBC yesterday that he doesn’t buy the 10- and 20-city composites of the Standard & Poor’s/Case-Shiller home price indices, released yesterday (see video above).
As The Real Deal reported yesterday, there was a 34 percent decline between the peak of the market in 2006 and January 2012, throwing home prices back to early 2003 levels.
However, Yearley pointed out that 25 percent of the communities where his company has homes have seen prices increase since Jan. 1 of this year.
“This spring season is the best selling season we’ve had in five years,” he said on CNBC. “It’s the deepest season. We’re now in late March and the selling season is continuing… so we feel really good right now.”
Yearley mentioned that buyer confidence has returned from five years on the sidelines, and that “there’s a flight to quality.”
He noted he’s seeing the most strength around New York City: Manhattan, Brooklyn’s Williamsburg and Dumbo as well as Hoboken. “We’re raising [prices] every week,” he said of New York. Most recently reported, both Toll and Equity Residential purchased a Park Avenue South lot in December. Beyond the New York City area, he said, Philadelphia and the Washington, D.C. to Boston corridor is also strong. That corridor is home to 60 percent of his business. Florida, he noted, “is beginning to come back, and we haven’t seen that now for five years.”
Yearley said golf courses and homes surrounding golf courses will be part of business down the line, but not as much as diversifying into more urban, more active adult regions.