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M/I Homes leans into specs as Q2 sales rise 15%
In Q2, spec homes made up 78% of sales as the builder’s gross margin fell to 22.0% from 24.7% a year earlier.
M/I Homes maintained a spec-heavy strategy in Q2 2026, with spec homes accounting for 78% of total sales, a HousingWire analysis of the company’s results shows. The builder reported 2,387 home closings in the quarter, up 15% year over year, with sales supported by mortgage rate buydowns.
The company said it has kept spec inventory elevated because of the current rate and demand environment, and it has aimed to control risk by improving construction cycle time to reduce overhead costs and by concentrating inventory on selected lots and home designs. HousingWire noted that spec homes often need generous incentives and buydowns to sell, which typically keeps margins below build-to-order homes.
M/I Homes also gave additional context on margin differences between to-be-built and spec homes during its earnings call, with CEO Robert Schottenstein saying the gap varies by market. HousingWire reports that in nearly all 17 markets, margins on to-be-builts are better, sometimes only slightly and sometimes more noticeably, with the company emphasizing that the differences can range materially from place to place.
Still, the quarter delivered record-setting volume for a second quarter in company history. Sales rose 13% in April, 23% in May, and 9% in June, and M/I Homes said it sold 4,737 homes in the first six months of 2026, up 8% year over year, even as new home sales across the market were down 5.6% year over year.