Company: UHG
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001830188-25-000012
Chunk: 12

Company: United Homes Group, Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 1
Chunk 12
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 come with lower maintenance costs and higher rents than older homes. UHG’s existing product set, geared towards entry-level and first-time move-up buyers, is highly consistent with the rental product desired by institutional capital. UHG expects to continue to explore opportunities in the BTR sector from time to time to augment its core for-sale business.

•Ancillary Revenue Growth Opportunities. UHG management continuously looks for accretive sources of EBITDA growth, not just in product line opportunities, but also in opportunities to drive additional EBITDA from existing operations. A key example of this is Homeowners Mortgage, which is a joint venture with a leading national lender that arranges mortgage financing for potential homebuyers and delivers incremental revenue to UHG and its stockholders. Beyond being a new source of revenue and EBITDA for UHG with little incremental expense or capital investment, Homeowners Mortgage, through its use of incentives, has helped improve buyer traffic conversion and reduce backlog cancellation rates.

Operational Initiatives

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Table of Contents

UHG launched multi-faceted operational improvement initiatives in 2024. Through an increased use of data, analytics, and standardization of processes, the Company expects to improve profitability and returns over time. While there are eight distinct workstreams related to these operational initiatives, the Company believes the following should have the largest impact on profitability in the near term:

•Product Improvement. UHG has undertaken a comprehensive review of its portfolio of house plans, rationalizing its offering, refreshing designs, and offering new customization options to buyers. The Company expects the refreshed offering to accelerate sales activity, increase pre-sales, and reduce the number of finished homes in inventory, resulting in a lower need for incentives and increased profitability from options and upgrades. Construction has begun on many of these revised plans and the Company expects they will comprise a meaningful part of closings by mid-2025. The Company expects to offer new product lines going forward as well. 

•Lowering Construction Costs. The Company has launched a formalized program aimed at reducing direct construction costs through the renegotiation and rebidding of major supplier, vendor, and subcontractor agreements. Combined with the product repositioning, lower costs and a higher level of standardization going forward is aimed at improving gross margin. 

•Comprehensive Land Underwriting. UHG has and will continue to make investments in land opportunities for future communities. The Company has and will continue to add to its team in this area and has increased the use of data and analytics to better align its communities and