NVR(NVR) - 2025 Q4 - Annual Report

Backlog and Home Prices - As of December 31, 2025, the backlog totaled 8,448 units valued at approximately $4.0 billion, down from 9,953 units valued at approximately $4.8 billion as of December 31, 2024[20] - The average price of homes in backlog decreased to $474,400 as of December 31, 2025, from $481,400 as of December 31, 2024[20] - The average price of homes settled was $460,600 in 2025, compared to $450,700 in 2024[18] Mortgage Loans and Banking - In 2025, the company closed approximately 16,400 mortgage loans with an aggregate principal amount of approximately $6.0 billion, compared to approximately 17,300 loans totaling approximately $6.3 billion in 2024[28] - Mortgage loans held for sale amount to $557,540,000 with an average interest rate of 6.0%[181] - The total fair value of mortgage loans held for sale is $571,596,000[181] Employee Count - As of December 31, 2025, the company had approximately 6,300 full-time employees, a decrease from approximately 7,000 employees as of December 31, 2024[32] Construction and Subcontracting - The company utilizes independent subcontractors under fixed price contracts for construction, ensuring no dependency on a small number of subcontractors[22] Interest Rate Risk and Strategy - The mortgage banking segment is exposed to interest rate risk, with strategies in place to mitigate this through forward sales contracts[179] - The average interest rate for mortgage loans held for sale is significantly higher than that of interest-bearing deposits, indicating a potential margin opportunity[181] - The overall interest rate sensitivity suggests a cautious approach to future rate changes impacting profitability[181] Liquidity and Financial Position - The company maintains a strong liquidity position with substantial interest-bearing deposits[181] - Interest-bearing deposits in the homebuilding segment total $1,827,493,000 with an average interest rate of 3.6%[181] - Fixed rate obligations are recorded at $900,000,000 with an average interest rate of 3.0%[181] - The company has no fixed rate obligations maturing before 2030, indicating a long-term liability strategy[181] Geographic Operations - The company operates in four geographic regions: Mid Atlantic, North East, Mid East, and South East[19] Future Expectations - The company expects to settle substantially all of its December 31, 2025 backlog during 2026, barring cancellations[20]