As many homebuilding operators retreat from entry-level and affordability-driven offerings, the founders of Houston-based StoneManor Homes are countering with a contrarian approach by launching Valera Homes, a new homebuilding brand of homes priced from the $270,000s to the $350,000s.
The Valera Homes brand extension arrives at a tricky moment for the most budget-conscious buyer segment. Elevated mortgage rates, higher energy costs, stubborn inflation and weak consumer sentiment have converged to upend the monthly payment calculus for entry-level and value-focused households. Builders have had to resort to “buying sales” through heavy, margin-eroding incentives and concessions.
As a result, more builders have scaled back their entry-level exposure and shifted their product mix upmarket, where move-up, active adult and luxury buyers typically require fewer incentives to close.
Hovnanian Enterprises, for example, announced during prior earnings calls this year that it was cutting its exposure to most entry-level price points and placing greater emphasis on move-up and active adult housing to generate stronger margins.
Meritage Homes, in July, similarly reported an “intentional shift” toward move-up homes, with less emphasis placed on entry-level homes. And M/I Homes, on an earnings call in August, noted that 43% of its sales came from its entry-level Smart Series, down from 52% a year earlier.
Beazer Homes executives, on earnings calls before this summer’s acquisition by Dream Finders Homes, similarly indicated that they expected their share of closings below $500,000 to decline by double digits by the end of fiscal 2026.
Most of these builders, and others pursuing a similar mix-shift, haven’t signaled an outright withdrawal from the entry-level segment, but are instead scaling back their emphasis on it. While that pullback signals a broad industry pivot, John Tucker, CEO of Valera Homes, believes that it also leaves a gap in the market that his company is positioned to fill.
“A lot of builders are getting out of that price point, and that allows us to penetrate quicker,” Tucker said in an interview with HousingWire TBD. “We feel like there’s space in there. Those people still need an affordable home right now.”
How Valera aims to deliver affordably priced homes
Tucker, previously with Gehan Homes for more than two decades, cofounded StoneManor Homes in 2025 alongside fellow homebuilding industry veteran Scott Sparks. The idea behind the new homebuilding venture was to offer fresh, innovative and semi-custom home designs, rather than relying on the recycled home plans Tucker had seen used in some of his previous roles.
Most StoneManor homes run from the mid-$300s up to about $1 million, and a few have even sold for up to $2 million. However, the company is diversifying its market segmentation by adding Valera Homes at a lower price point.
One way that Valera plans to keep its homes attainable is by prioritizing design and construction standardization and efficiency, in contrast to StoneManor’s more semi-custom approach.
“These are 19-foot-wide plans, very efficient with two stories and multiple elevations, anywhere from a very nice craftsman all the way to a very modern elevation,” Tucker said.
Working with a designer, Valera Homes narrowed its everything-included floorplan line-up to five interior and 10 exterior packages, and buyers simply pick their selections at the model home. Because the options are so limited, the purchasing and construction teams know exactly what each home requires, which means fewer errors and lower costs. Beyond that, Tucker says the homes are simple to build, which allows the company to bend its asking-price curve downward.
“The only thing we need to factor in is theft, because other than that, they’re very simple to build,” Tucker said.
Where Valera builds matters as much as how it builds. The company favors locations whose land basis and development costs make its target price range achievable, and where buyers actually want to live. The builder launched with four initial Houston-area communities in established submarket infill locations close to job centers.
“We will take this product out to the [peripheral] suburbs, but currently we want to start in more infill urban areas. There’s more demand in those locations for this type of product,” Tucker explained.
The entry-level gambit
According to Tucker, Valera should eventually drive around 60% of the company’s sales, with StoneManor making up the other 40%.
“We’re trying to get that top-line growth with Valera, the bottom-line growth with StoneManor, and have a true separation between the two,” Tucker explained.
However, Tucker also has reasonable expectations, especially given the challenges builders are facing right now. He anticipates that Valera will generate a “decent margin,” enough for sustainable growth, but he conceds that he doesn’t expect “a killer margin by any means in today’s market.”
According to Tucker, Valera Homes is looking to do about two to three sales per month per community for the foreseeable future, calling that pace “a home run in today’s market.”
At the core of Valera’s approach is the belief that entry-level buyers should have an attainably priced option, particularly now, when so many competitors are migrating their offerings upmarket where buyers are less interest rate- and price-sensitive.
Tucker believes that delivering on that belief is realistic, not just aspirational.
“The uncertainty is out there, with mortgage rates and everything else, but we are still trying to make sure people can afford a home. Affordability is a problem, but we’ve searched out places where we feel like that customer can afford, and will be able to qualify for these homes,” he said.
