10 Best Residential Real Estate Stocks To Buy

4. Toll Brothers, Inc. (NYSE:TOL)

Number of Hedge Fund Holders: 46

Toll Brothers, Inc. (NYSE:TOL) was founded in southeastern Pennsylvania in 1967 by the brothers Bob and Bruce who wanted to create a home-building company that was always striving to reach a higher standard. The firm expanded across the US over the years and emerged as America’s luxury home builder. Currently, it operates in 24 states and over 60 markets nationwide.

The home builder’s national footprint positions it well for growth. The growth prospects are even stronger as it has the widest variety of products and the widest range of prices of any of the builders. The prestigious and desirable locations to build in, distinctive architecture, unrivaled choice, and exceptional customer service are some of the Toll Brothers’ advantages that set them apart from the competition.

Toll Brothers recently witnessed a record third-quarter home sales revenue of $2.72 billion. Since the current market is experiencing a general housing inventory shortage and falling mortgage rates, the prospects for the home builder remain positive. Notable demographic trends that will benefit the firm’s business in the future will be the baby boomers looking for new houses as they retire and the older millennials hitting their 40s over the next decade.

The home builder has sufficient land under control as it plans to grow its community count next year. At the quarter end, it owned or controlled 72,700 lots. This strong land position offers sufficient lots required for growth in fiscal 2025 and later. Leveraging this position, Toll Brothers is striving for its goal of operating from 410 communities by fiscal year-end, an expected 11% growth as compared to the year’s start.

Toll Brothers has brought its sales up 25% year-to-date amid elevated mortgage rates. The unique advantages in an industry as competitive as housing, favoring trends, a healthy balance sheet with low net debt, and planned growth opportunities rank Toll Brothers, Inc. (NYSE:TOL) among the best residential real estate stocks to buy.