KB Home's Unique Approach to Mortgage Rates and Stock Performance Surprises Wall Street

KB Home, a homebuilder, is taking a different approach than its competitors by skipping mortgage rate buydowns and instead focusing on customization and rate locks to cater to buyers. The company believes in offering the best price for the best value and allowing buyers to pick everything. While other homebuilders are offering aggressive rate buydowns to entice buyers, KB Home has used this perk sparingly. The rise in mortgage rates has made buying a home more challenging, with rates lingering above 7%. KB Home closed 3,375 homes in the third quarter, higher than expected, but still 6.6% lower year over year. The company remains committed to focusing on the underserved segment of first-time or move-up buyers and expects fourth-quarter home sales revenue of $1.55 billion to $1.65 billion.