Dream Finders Homes enters Phoenix market with two giant land buys

A Florida homebuilder is making its Arizona debut with the purchase of nearly 300 lots on opposite ends of metro Phoenix.

Dream Finders Homes Inc. (NYSE: DFH) secured the last piece of Phase IV at Bella Vista Farms master-planned community in San Tan Valley and took another 36.57 acres at El Cidro in Goodyear.

The firm's land banker, Terra Firma Capital Corp., paid $20.4 million to Dallas-based Landsea Homes Corp. (Nasdaq: LSEA) for 160 lots west of the southwest corner of Cotton Lane and Elwood Street at El Cidro in Goodyear, according to Tempe-based real estate database Vizzda LLC.

"With a high demand for platted and engineered lots in the Phoenix metro area, we saw a great opportunity to diversify our portfolio and sell a parcel in El Cidro to Dream Finders Homes," said Heather Cammiso, Arizona Division President of Landsea Homes, which also sold 102 lots at El Cidro to Miami-based Lennar Corp. (NYSE: LEN) for $14.01 million in cash last fall.

In the San Tan Valley, Terra Firma paid $6.36 million to Scottsdale-based El Dorado Holdings Inc. for 122 lots north of the northeast corner of Gantzel and Bella Vista roads in Bella Vista Farms, according to Vizzda.

Scottsdale-based Nathan & Associates negotiated both El Cidro transactions, along with the Bella Vista Farms deal. David Mullard, Casey Christensen and Nate Nathan handled the El Cidro deals, while Courtney Buck, Daniel Baldwin and Nathan handled the lot sales at Bella Vista Farms. Both of the new transactions closed June 27.

The purchase at Bella Vista Farms closes out lot sales within Phase IV, which totaled 1,030 lots, said Michael Ingram, founder and chairman of El Dorado Holdings, developer of the 1,500-acre master-planned community.

So far, 2,360 lots have sold at Bella Vista Farms, with another 2,500 left to sell, Ingram said.

"We're really excited about having Dream Finders in the marketplace," Ingram said. "They've got a great reputation."

Dream Finders has named Tyler Champlin as Phoenix division president, taking him from Scottsdale-based Meritage Homes Corp. (NYSE: MTH), where he served as vice president of land acquisitions. He also previously served as project manager for Lennar.

Tyler Champlin, Phoenix division president for Dream Finders Homes.

DREAM FINDERS HOMES

Plans call for home sales to begin during the third quarter of 2025 at Bella Vista Farms and late next summer at El Cidro, with prices expected to start in the mid $400,000s.

Builder enters Phoenix metro at a time of positive trends

With operations in nine states, Dream Finders is ranked No. 12 on Pro Builder's 2024 Housing Giants Report. Its average sales price of homes in those markets was $490,553.

The homebuilder reported $239.4 million in cash on hand for the quarter ended March 31, down from $494.1 million in cash on Dec. 31, according to its latest 10-Q filing with the Securities and Exchange Commission.

While cash on hand was down, net income and revenue were up.

The company reported $54.5 million in net income on $827 million in total revenue for the three months ended March 31, up from $49.1 million in net income on revenue of $769.4 million during the same period in 2023.

The homebuilder's entry into the Phoenix market comes at a time when the market is showing positive trends.

Through June 28, homebuilders completed 605 transactions totaling $1.63 billion, said Jim Daniel, president of RL Brown Housing Reports. Those transaction represented 10,090 lots and 5,173 acres.

Also during the first half of 2024, homebuilders secured 13,652 single family permits, up 45% from the same time last year when there were 9,408 permits issued, Daniel said.

Year to date, there were 11,628 new home closings, up 1.87% from the same period in 2023 when there were 11,414 home closings, he said.

Home prices also are inching up again at a time when Maricopa County was ranked No. 1 in the country for economic growth.

The new home median price was $469,017 at the end of June, up from $479,296 in June 2023, Daniel said.

"I'm really happy with the way the first half has turned out," Daniel said. "We're right on our forecast for 2024. All the fundamentals are in place. We look forward to continuing on through 2024."

It makes sense that Phoenix would be at the top of Dream Finders' expansion list, said RL Brown, founder and publisher of RL Brown Housing Reports.

"Dream Finders is typical of what we can expect as the regional builders across country see the kind of housing market numbers we are reporting consistently in the Phoenix and Tucson markets," Brown said.

Meanwhile, Mattamy Homes is hosting a grand opening celebration at Miravida in Surprise, while Landsea sold out its 82 home at Vidrio in Estrella master-planned community in Goodyear,