LGIH · 10-Q · 2026Q1 · Full report

Market Demand Trends

LGI Homes, Inc. · 2026-04-28 · Importance 13 · Surprise 6

LGI describes a challenging macro backdrop with persistently high mortgage rates and subdued consumer sentiment that pressured entry-level buyer demand in Q1 2026. Management states mortgage rates trended upward due to inflation, economic uncertainty and geopolitical developments (including the conflict in the Middle East), reducing buyers’ willingness to purchase new homes. In response, LGI emphasized affordable, move-in ready homes with financial incentives and targeted discounts on older completed inventory to bridge affordability gaps for entry-level customers.

Key facts

• Southeast segment average monthly absorption rate was 2.5 for the three months ended March 31, 2026 and 3.5 for the three months ended March 31, 2025.
• In response to affordability pressures, the company continued offering affordable, move-in ready homes supported by financial incentives and targeted discounts on older completed inventory during the quarter.
• Central segment average monthly absorption rate was 2.1 for the three months ended March 31, 2026 and 2.2 for the three months ended March 31, 2025.
• Northwest segment average monthly absorption rate was 1.5 for the three months ended March 31, 2026 and 1.3 for the three months ended March 31, 2025.
• Average monthly absorption rate for the company was 2.1 homes for the three months ended March 31, 2026 (company total).
• Florida segment average monthly absorption rate was 1.9 for the three months ended March 31, 2026 and 1.7 for the three months ended March 31, 2025.
• West segment average monthly absorption rate was 2.1 for both the three months ended March 31, 2026 and March 31, 2025.
• The company stated subdued consumer sentiment and ongoing affordability constraints have impacted buyers’ willingness to purchase new homes during the quarter.