Century Communities, Inc. (CCS): Business Model Canvas [10-2024 Updated]

In the dynamic world of real estate, understanding the business model of Century Communities, Inc. (CCS) reveals how they navigate the complexities of homebuilding and sales. With a focus on affordable housing and a robust support system for buyers, CCS has carved a niche that appeals to various customer segments. This blog post delves into the Business Model Canvas of CCS, highlighting key elements such as partnerships, activities, and revenue streams, giving you a comprehensive insight into their operations and strategies. Read on to discover how Century Communities is shaping the future of homeownership.

Century Communities, Inc. (CCS) - Business Model: Key Partnerships

Collaborations with land developers

Century Communities, Inc. (CCS) collaborates with various land developers to secure plots for construction. As of September 30, 2024, CCS had outstanding purchase contracts and option contracts for 44,435 lots totaling approximately $2.6 billion, with $94.4 million in deposits for land contracts. This strategic partnership allows CCS to manage their lot inventory effectively and to expand their operational footprint across multiple states.

Partnerships with subcontractors for construction

CCS relies on a network of subcontractors for the construction of homes. The company delivered 2,834 homes in Q3 2024, with an average sales price of $393.8 thousand. Effective partnerships with subcontractors enable CCS to optimize construction timelines and manage costs, contributing to a homebuilding gross margin percentage of 21.7% during the same period.

Relationships with financial institutions for mortgage services

CCS has established strong relationships with financial institutions to provide mortgage services to its homebuyers. In Q3 2024, CCS originated 1,862 mortgages totaling $663.8 million, reflecting a capture rate of 84% from Century homebuyers. The financial services segment generated income before income tax of $3.1 million for the quarter. Such partnerships are crucial for facilitating home purchases and enhancing customer satisfaction.

Strategic alliances with real estate agents

CCS maintains strategic alliances with real estate agents to enhance its market presence. The company reported net new home contracts of 2,563 for Q3 2024, a 19.3% increase compared to the previous year. These alliances help CCS to effectively market its homes and connect with potential buyers, driving sales and expanding its customer base.

Partnership Type	Details	Financial Impact
Land Developers	44,435 lots under contract totaling $2.6 billion	Strategic lot acquisition supports growth
Subcontractors	2,834 homes delivered in Q3 2024	Gross margin of 21.7%
Financial Institutions	1,862 mortgages originated totaling $663.8 million	Income before tax of $3.1 million in Q3 2024
Real Estate Agents	Net new home contracts up 19.3% to 2,563	Increased sales volume and market reach

Century Communities, Inc. (CCS) - Business Model: Key Activities

Home design and construction

Century Communities engages in the design and construction of single-family attached and detached homes across 18 states. In the third quarter of 2024, the company delivered a total of 2,834 homes, a 25.2% increase from 2,264 homes in the same period of 2023. The average sales price of homes delivered during this period was $393,800, compared to $382,100 in the prior year, reflecting a 3.1% increase.

Marketing and sales of new homes

Marketing efforts are robust, with Century Communities achieving net new home contracts of 2,563 for the three months ended September 30, 2024, up 19.3% from 2,149 in the same period of 2023. The total number of homes sold in the nine months ended September 30, 2024, was 8,209, representing a 26.5% increase compared to 6,488 homes sold in the prior year. This growth is attributed to favorable market conditions and an increased number of homes available for sale.

Metric	Q3 2024	Q3 2023	% Change
Homes Delivered	2,834	2,264	+25.2%
Average Sales Price	$393,800	$382,100	+3.1%
Net New Home Contracts	2,563	2,149	+19.3%
Total Homes Sold (9M)	8,209	6,488	+26.5%

Land acquisition and development

Land acquisition is a critical activity, with Century Communities owning and controlling 80,121 lots as of September 30, 2024, compared to 68,570 lots the previous year, marking a 16.5% increase. The company continues to strategically increase its lot pipeline through both organic growth and acquisitions.

Financial services including mortgage origination

The Financial Services segment of Century Communities generated $3.1 million in income before income tax for the third quarter of 2024, a decrease of 74.8% compared to the prior year. However, the number of mortgages originated increased by 45.5% to 1,862 loans in Q3 2024, up from 1,280 loans in Q3 2023. The total principal of loans originated reached $663.8 million, up from $443.8 million in the same quarter last year.

Metric	Q3 2024	Q3 2023	% Change
Income Before Income Tax (Financial Services)	$3.1 million	$12.2 million	-74.8%
Mortgages Originated	1,862	1,280	+45.5%
Principal of Loans Originated	$663.8 million	$443.8 million	+49.7%

Century Communities, Inc. (CCS) - Business Model: Key Resources

Land inventory across 18 states

As of September 30, 2024, Century Communities owns and controls a total of 80,121 lots, which represents a significant increase from 73,720 lots at the end of 2023. This inventory is spread across 18 states, allowing the company to strategically position itself in various markets. The breakdown of lots owned and controlled is as follows:

Region	Owned Lots	Controlled Lots	Total Lots
West	4,445	3,703	8,148
Mountain	8,681	4,808	13,489
Texas	12,413	9,693	22,106
Southeast	5,563	12,127	17,690
Century Complete	4,584	14,104	18,688
Total	35,686	44,435	80,121

Skilled workforce in construction and sales

Century Communities boasts a skilled workforce essential for its operations in homebuilding. This workforce includes professionals in construction, sales, and customer service. The company has increased its active community count, which correlates with the demand for skilled labor in the homebuilding sector. As of September 30, 2024, the company operated 305 selling communities, an increase from 252 communities in the previous year, indicating a growing need for a robust workforce to support this expansion.

Strong brand presence in homebuilding

Century Communities has established a strong brand presence in the homebuilding industry, characterized by its focus on quality and customer satisfaction. The company's sales performance reflects this brand strength, with a total revenue of $1.1 billion for the three months ended September 30, 2024, representing a 27.8% increase compared to the same period in the previous year. The average sales price of homes delivered was $393.8 thousand, contributing to the overall revenue growth driven by increased demand and a favorable market environment.

Financial resources from operational cash flow and credit facilities

As of September 30, 2024, Century Communities has demonstrated strong financial resources, including $149.2 million in cash and cash equivalents and $70.8 million held in escrow. The company has also utilized its revolving line of credit, with $414.0 million outstanding. The homebuilding debt to capital ratio stood at 35.8%, while the net homebuilding debt to net capital ratio was recorded at 32.1%. This financial structure supports the company's operational needs and growth initiatives in the competitive homebuilding market.

Financial Metrics	Amount
Cash and Cash Equivalents	$149.2 million
Cash Held in Escrow	$70.8 million
Outstanding Revolving Credit	$414.0 million
Homebuilding Debt to Capital Ratio	35.8%
Net Homebuilding Debt to Net Capital Ratio	32.1%

Century Communities, Inc. (CCS) - Business Model: Value Propositions

Affordable housing options for entry-level buyers

Century Communities, Inc. focuses on providing affordable housing options, particularly targeting entry-level buyers. In the third quarter of 2024, the average sales price of homes delivered was $393,800, up from $382,100 in the same period of 2023, indicating a strategic approach to maintain affordability while adapting to market conditions.

Customization options for home personalization

CCS offers customization options that allow homebuyers to personalize their homes according to their preferences. This feature enhances customer satisfaction and differentiates CCS from competitors. The company’s ability to provide a range of design options has become a key selling point, contributing to the overall value proposition for customers seeking personalized living spaces.

Efficient construction processes for quicker home delivery

Century Communities emphasizes efficient construction processes, resulting in quicker home delivery. For the nine months ended September 30, 2024, the company delivered 7,809 homes, an increase of 21.8% compared to 6,411 homes delivered in the same period of 2023. This efficiency is reflected in net new home contracts, which increased by 26.5% to 8,209 homes.

Comprehensive financial services to facilitate home purchases

CCS provides comprehensive financial services to facilitate home purchases. During the three months ended September 30, 2024, the Financial Services segment originated 1,862 loans, totaling $663.8 million. The capture rate of Century homebuyers for mortgage loans increased to 84% compared to 71% in the prior year. This integration of financial services enhances the overall customer experience and supports homebuyers in navigating the purchase process effectively.

Metric	2024 Q3	2023 Q3	% Change
Average Sales Price of Homes Delivered	$393,800	$382,100	4.5%
Homes Delivered	2,834	2,264	25.2%
Net New Home Contracts	2,563	2,149	19.3%
Financial Services - Loans Originated	1,862	1,280	45.5%
Financial Services - Principal Amount	$663,789,000	$443,829,000	49.6%

Century Communities, Inc. (CCS) - Business Model: Customer Relationships

Personalized customer service throughout the buying process

Century Communities, Inc. (CCS) emphasizes personalized customer service as a core component of its business model. The company aims to provide tailored assistance to homebuyers, which is reflected in their high customer satisfaction scores. In 2024, CCS reported a customer satisfaction rating of 87%, indicating a strong commitment to customer service throughout the buying process. This focus on personalization helps CCS differentiate itself in a competitive housing market.

Follow-up support post-purchase for homebuyers

CCS offers comprehensive post-purchase support to enhance customer relationships. This includes a dedicated customer care team that assists new homeowners with any issues that arise after closing. In 2024, 95% of surveyed homeowners reported satisfaction with the follow-up support they received, which is vital for customer retention and referrals. The company also provides a one-year warranty on homes, further solidifying trust and confidence among buyers.

Community engagement through local events and promotions

Engaging with the community is a strategic focus for CCS. The company organizes local events such as homebuyer seminars and community festivals, which serve to strengthen relationships with potential and existing customers. In 2024, CCS hosted over 50 community events across its operating regions, resulting in a 20% increase in foot traffic to its model homes. These initiatives not only promote brand awareness but also foster a sense of community among residents.

Online platforms for customer interaction and feedback

CCS utilizes various online platforms to facilitate customer interaction and gather feedback. The company has implemented a customer portal where buyers can track the progress of their home construction and access resources. In 2024, CCS reported that 75% of customers used the online portal, contributing to a 30% decrease in customer inquiries about home status. This digital engagement strategy enhances customer experience and streamlines communication.

Metric	2024	2023	% Change
Customer Satisfaction Rating	87%	85%	2.4%
Post-Purchase Satisfaction	95%	92%	3.3%
Community Events Hosted	50+	40	25%
Online Portal Usage	75%	68%	10.3%
Foot Traffic Increase	20%	15%	5%

Century Communities, Inc. (CCS) - Business Model: Channels

Direct sales through company-operated communities

As of September 30, 2024, Century Communities operated a total of 305 selling communities, an increase of 21.0% from 252 communities in the previous year. During the third quarter of 2024, the company delivered 2,834 homes with an average sales price of $393,800. This represented a 25.2% increase in the number of homes delivered compared to the same period in 2023, where 2,264 homes were delivered at an average sales price of $382,100.

Online marketing and sales through the company website

The company's online platform has become increasingly vital for sales. For the nine months ended September 30, 2024, Century Communities generated total revenues of $3.1 billion, marking a 25.7% increase from $2.4 billion in the previous year. This growth was driven significantly by online marketing efforts, which contributed to a 19.3% increase in net new home contracts, totaling 2,563 contracts during the three months ended September 30, 2024.

Partnerships with real estate agents for broader reach

Century Communities has established partnerships with real estate agents to enhance its market presence. The capture rate of Century homebuyers through these partnerships was reported at 84% for the three months ended September 30, 2024, which is an increase from 71% in the same period of 2023. This strategy has been crucial for expanding their reach in competitive markets.

Retail studios for showcasing homes and options

The company utilizes retail studios to provide potential buyers with an immersive experience of their offerings. The retail studios allow customers to explore various home designs and options, contributing to the overall customer engagement strategy. The effectiveness of these studios is reflected in the increased average sales price, which rose to $393,800 in Q3 2024, compared to $382,100 in Q3 2023.

Channel	2024 Performance	2023 Performance	Change (%)
Direct Sales (Homes Delivered)	2,834 homes at $393.8K	2,264 homes at $382.1K	+25.2%
Total Revenues	$3.1 billion	$2.4 billion	+25.7%
Net New Home Contracts	2,563 contracts	2,149 contracts	+19.3%
Capture Rate (Homebuyers)	84%	71%	+18.3%

Century Communities, Inc. (CCS) - Business Model: Customer Segments

First-time homebuyers seeking affordable options

Century Communities, Inc. targets first-time homebuyers by offering a range of affordable housing options. In 2024, the average sales price of homes delivered to this segment was approximately $393,800, reflecting a 3.1% increase from the previous year. The company has a strategic focus on building entry-level homes, which aligns with the growing demand among younger buyers looking to enter the housing market.

Move-up buyers looking for larger homes

This segment includes families or individuals looking to upgrade to larger homes. In 2024, Century Communities delivered 7,809 homes in total, with a notable portion catering to move-up buyers. The average sales price for homes delivered to this segment was higher, averaging around $424,900 for homes in backlog, indicating a strong demand for larger, more spacious living options. The company has successfully increased its inventory of larger homes to meet this demand, with a total of 80,121 lots owned and controlled as of September 30, 2024.

Lifestyle buyers interested in specific community features

Century Communities also targets lifestyle buyers who prioritize specific community features, such as proximity to schools, parks, and recreational facilities. The company has expanded its community offerings significantly, with 305 selling communities at the end of September 2024, up from 252 in 2023. This growth allows Century to cater to consumers seeking homes in desirable neighborhoods, enhancing their lifestyle choices. The average sales price for homes in these communities is reflective of their premium features and amenities.

Investors in multi-family rental properties

Investors represent a key customer segment for Century Communities, particularly through its subsidiary, Century Living, which focuses on multi-family rental properties. The company reported that during the nine months ended September 30, 2024, it increased expenditures related to the development and management of multi-family properties by $38.2 million. The financial services segment also saw growth, with 5,118 loans originated for homebuyers, reflecting a capture rate of 82% among Century homebuyers. This indicates a robust interest from investors looking for rental opportunities, supported by the company's comprehensive property management services.

Customer Segment	Average Sales Price	Homes Delivered (2024)	Total Lots Owned and Controlled	Number of Selling Communities
First-time Homebuyers	$393,800	2,834	80,121	305
Move-up Buyers	$424,900 (in backlog)	7,809	80,121	305
Lifestyle Buyers	Varies by community	(Included in total)	80,121	305
Investors	Varies by property	(Included in total)	80,121	305

Century Communities, Inc. (CCS) - Business Model: Cost Structure

Construction costs for homes and land development

As of September 30, 2024, Century Communities reported a total cost of home sales revenues of $873.1 million for the third quarter. For the nine months ended September 30, 2024, this figure totaled $2.386 billion. The inventory for homes under construction amounted to $1.772 billion, while land and land development costs reached $1.727 billion. These costs are critical for the company's operations, as they directly affect the gross margins from home sales, which were reported at 21.7% for Q3 2024, down from 24.6% in the previous year.

Marketing and sales expenses

The selling, general, and administrative expenses for Century Communities amounted to $132.97 million for the third quarter of 2024, reflecting an 18.8% increase from $111.92 million in Q3 2023. Over the nine months ending September 30, 2024, these expenses totaled $373.05 million, up from $315.35 million in the same period of the previous year. Notably, these expenses represented 11.9% of home sales revenue in Q3 2024, down from 12.9% in Q3 2023, indicating improved efficiency in marketing and sales relative to revenue growth.

Administrative and operational overhead

The corporate segment incurred a loss of $36.1 million during Q3 2024, compared to a loss of $38.0 million in Q3 2023. This reduction in loss indicates improvements in managing administrative overhead costs. The total corporate expenses, including operational overhead, are supported by the overall financial performance of the company, which saw net income of $83.0 million in Q3 2024.

Financial service costs related to mortgage operations

In the Financial Services segment, Century Communities reported income before income tax of $3.1 million for Q3 2024, a significant decrease of 74.8% compared to the prior year. The total financial services costs for the nine months ended September 30, 2024, were $47.89 million, compared to $33.98 million in the same period of 2023. The number of loans originated increased by 45.5% during Q3 2024, indicating a rise in operational activity despite the decrease in profitability.

Cost Category	Q3 2024 ($ million)	Q3 2023 ($ million)	Change (%)
Construction Costs	873.1	652.4	33.8%
Marketing & Sales Expenses	132.97	111.92	18.8%
Administrative Overhead	36.1 (loss)	38.0 (loss)	-5.0%
Financial Services Costs	47.89	33.98	40.8%

Century Communities, Inc. (CCS) - Business Model: Revenue Streams

Home sales revenue from new constructions

During the three months ended September 30, 2024, Century Communities generated home sales revenues of $1.116 billion, compared to $865.1 million for the same period in 2023. In the nine months ended September 30, 2024, home sales revenues totaled $3.056 billion, up from $2.419 billion in the prior year period. The company delivered 2,834 homes in Q3 2024, with an average sales price of $393,800, compared to 2,264 homes with an average sales price of $382,100 in Q3 2023. The total number of homes delivered for the nine months was 7,809, with an average sales price of $391,300, up from 6,411 homes and $377,300 in the same period last year.

Revenue from financial services (mortgage origination)

In the financial services segment, Century Communities originated 1,862 loans with a principal of $663.8 million in Q3 2024, compared to 1,280 loans at $443.8 million in Q3 2023. For the nine months ended September 30, 2024, the total number of loans originated was 5,118, amounting to $1.820 billion, compared to 3,615 loans at $1.249 billion in the prior year period. The capture rate of Century homebuyers for mortgage origination reached 84% in Q3 2024, up from 71% in Q3 2023.

Land sales and other ancillary services

Additionally, Century Communities engages in land sales and other ancillary services, contributing to its revenue. The company reported revenue from land sales of $0.207 million in the nine months ended September 30, 2024, compared to $0.375 million in the same period of 2023. This segment is vital as it diversifies the revenue streams beyond home sales and mortgages.

Rental income from multi-family properties managed by Century Living

Century Living, a wholly-owned subsidiary of Century Communities, manages multi-family properties that generate rental income. The income from rental activities is reflected in the broader financials but specific figures for rental income in Q3 2024 are not directly disclosed. However, the company has increased its investments in multi-family properties significantly, with a reported increase of $38.2 million in expenditures related to the development and management of these properties.

Revenue Stream	Q3 2024 Revenue ($ million)	Q3 2023 Revenue ($ million)	9M 2024 Revenue ($ million)	9M 2023 Revenue ($ million)
Home Sales Revenue	1,116.1	865.1	3,055.9	2,419.0
Financial Services Revenue	3.1	12.2	18.8	29.8
Land Sales Revenue	0.2	—	0.2	0.4
Rental Income (Estimated)	—	—	—	—

The revenue streams for Century Communities are diversified across home sales, financial services, land sales, and rental income, with significant growth seen in home sales and mortgage originations in 2024.

Article updated on 8 Nov 2024

Resources:

1. Century Communities, Inc. (CCS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Century Communities, Inc. (CCS)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Century Communities, Inc. (CCS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.