Five of the largest homebuilders in the United States have joined together to provide new home listings nationwide and sell home-related after-market products over the Internet.
Centex Corp. (NYSE: CTX), D.R. Horton, Inc. (NYSE: DHI), Kaufman & Broad Home Corp. (NYSE: KBH), Lennar Corp. (NYSE: LEN) and Pulte Corp. (NYSE: PHM) said they will form a separate company to create the Web site, which is yet unnamed.
The companies added that the site will be open to other new home builders and to companies in the industry that provide after-market products.
Salomon Smith Barney has been engaged to serve as financial advisor in setting up the new company. The management team for the site is expected to be in place within 30 days.
Plan To List 200,000 Homes Nationwide
Together, the five companies sell about 100,000 new homes a year in the U.S., mostly in the South and West. The firms expect to advertise about 200,000 homes all over the country in the first year, and believe that the total number of homes on the site will be far higher when other homebuilders join their efforts.
The builders claim that the site will be the most comprehensive listing of new homes available in the United States. Along with details about the properties for sale, the site will include “accurate and timely information about communities” that is unavailable to consumers through multiple listing services.
As an additional benefit for home buyers, the builders say the site will provide maintenance and construction specs on the homes, information that is often hard to get with conventional resources, upgrades and improvements.
$10K to $15K in After-Market Products
In making the announcement, the companies noted that the average new home buyer spends between $10,000 and $15,000 (US$) in the first year on products and services for the property. Salomon Smith Barney believes that the sale of such products holds “significant e-commerce potential.”
“In addition to providing high value sales information, the site is also expected to be an important destination for homeowners following the sale by providing critical maintenance and construction specification information, customized to their individual home,” the firms said in a press release.
The companies added that this information will make it easier for homeowners and contractors to plan after-market upgrades or to perform maintenance.