Converting renters to owners propels LGI Homes’ growth.
Mike Snider likes to say that LGI Homes, where he’s executive vice president of home building, does “everything the opposite of other builders.”
That contrariness has been paying dividends for the Conroe, Texas–based company, whose officers claim is the only production builder among the top 200 that increased its revenue and closings in each of the last three years.
LGI has a unique business model that favors spec building, targets local renters, and follows leads with a highly trained salesforce. The company expects to break records for dollars and unit sales again in 2009 and is raising capital to expand beyond its two subdivisions in Houston and one in San Antonio. “There’s no reason why, in the Texas market, we can’t go to five, eight, 10 communities, take the LGI way of selling there, and be phenomenally successful,” says Eric Lipar, the builder’s president.
That confidence, in the face of a housing recession, would be laughable if it weren’t for LGI’s track record in recent years. Lipar’s father founded LGI Homes in 1995 as a land developer specializing in acreage home sites located 45 to 60 miles outside of urban centers. It continues in that business today, but five years ago its owners decided to take that business model into entry-level housing. A year later, it hired Snider, a former project manager at Tadian Homes in Michigan, whose training has focused on environmental sciences and land-use planning. Read the rest of this entry »