(Reuters) - U.S. homebuilder PulteGroup (NYSE:PHM) beat Wall Street estimates for second-quarter profit on Tuesday, as an acute shortage of existing houses drove up demand for new constructions.
Shares of the company gained about 1% in premarket trading after its home sales revenue also rose during the period.
With the popular 30-year fixed mortgage rate hovering at about 7% for months, U.S. homeowners are holding onto lower rates secured on properties during an era of cheap debt.
This "rate lock-in" has constrained sales of existing homes in the United States, prompting buyers to turn to newly constructed houses even amid a surge in property prices.
"While interest-rate movements can impact short-term homebuying demand, long-term market dynamics continue to benefit from a structural shortage of homes caused by years of underbuilding," said CEO Ryan Marshall.
PulteGroup, which usually sells a mix of cheaper pre-constructed homes and more expensive build-to-order homes based on buyer specifications, delivered 8,097 homes in the quarter ended June 30, up 8% from a year earlier.
The Atlanta, Georgia-based company reported a 10% rise in home sales revenue to $4.4 billion in the second quarter.
Average selling price of $549,000 per home was also 2% higher than the year earlier, with home sales gross margin rising 30 basis points to about 30%.
The company earned an adjusted $3.77 per share in the second quarter, ahead of analysts' average estimate of $3.27 per share, according to LSEG data.