As a Mortgage Broker and owner of MJ Mortgage LLC in Magnolia, Texas, I’m always keeping a close eye on the housing market. I wanted to share some important insights from a recent article that focused on remarks from KB Home’s Chief Operating Officer, Rob McGibney.
A Warning About Homebuilder Incentives
- According to KB Home COO Rob McGibney, some homebuyers are overpaying for a new home to receive incentives like mortgage rate buydowns.
- McGibney states that these buyers are “tied into this higher price that they’re gonna be stuck with forever until they sell that home”.
- He warns that these homebuyers “may potentially be upside down when they try to sell that home”.
- In contrast to some other builders, KB Home prefers transparent, outright price cuts instead of incentives.
Market Softening and Local Dynamics
- McGibney noted in a June 23, 2025 earnings call that the 2025 housing market is softer than the company anticipated.
- Net new orders at KB Home declined in April and May, which is unusual for the typical spring season.
- He emphasized that the market is “very local and very dynamic,” and that all of the markets where KB Home operates experienced some level of softening.
- McGibney pointed out that in markets where resale inventory is high (at or above six or seven months of supply), resales are a “more formidable competitor”.
- In response, KB Home cut base prices in half of their communities during the quarter ending May 31.
It’s clear that the housing market is shifting. If you’re considering buying a new construction home, it’s crucial to understand all aspects of the transaction, especially how incentives might affect the home’s long-term value.
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Source: Link to Article
Sal Trapani, Mortgage Broker/Owner, MJ Mortgage LLC, 281-608-2846 cell, sal@mjmortgagellc.com, www.mjmortgagellc.com NMLS 1055510 / NMLS 2381195