Company: UHG
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001830188-25-000012
Chunk: 26

Company: United Homes Group, Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 1A
Chunk 26
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Item 1A. Risk Factors

Risks Related to UHG’s Business

UHG’s inability to successfully identify, secure and control an adequate inventory of lots at reasonable prices could adversely impact UHG’s operations.

The results of UHG’s homebuilding operations depend in part upon UHG’s continuing ability to successfully identify, control and acquire an adequate number of homebuilding lots in desirable locations. There can be no assurance that an adequate supply of homebuilding lots will continue to be available to UHG on terms similar to those available in the past, or that UHG will not be required to devote a greater amount of capital to controlling homebuilding lots than UHG has historically. In addition, because UHG employs a land-light business model, UHG may have access to fewer and less attractive homebuilding lots than if UHG owned lots outright, like some of UHG’s competitors who do not operate under a land-light model.

An insufficient supply of homebuilding lots in one or more of UHG’s markets, an inability of UHG’s developers to deliver finished lots in a timely fashion due to their inability to finance development activities, delays in recording deeds, conveying controlled lots as a result of government shut downs, or for other reasons, or UHG’s inability to purchase or finance homebuilding lots on reasonable terms could have a material adverse effect on UHG’s sales, profitability, ability to service its debt obligations and future cash flows. Any land shortages or any decrease in the supply of suitable land at reasonable prices could limit UHG’s ability to develop new communities or result in increased lot deposit requirements or land costs. UHG may not be able to pass any increased land costs to its customers, which could adversely impact UHG’s revenues, earnings and margins.

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Table of Contents

UHG considers a lot controlled when it holds an option to acquire the applicable lot for the relevant timeframe set forth in the option contract, in addition to lots that are owned or controlled by related parties and which UHG expects to obtain the contractual right to acquire. After UHG signs a finished lot option contract, but prior to the deposit becoming non-refundable (except for certain circumstances such as seller default or force majeure events), UHG has an initial inspection and due diligence period, during which time UHG inspects the property to make sure it meets certain development requirements (e.g., zoning, environmental approvals, and other customary requirements). If UHG discovers that the property does not sufficiently meet the development requirements after this period has passed, U