Signature Homes thinks 100-day builds can win in a smaller market

That premise is shaping nearly every part of the operating system at Signature Homes, a Birmingham, Alabama-based private builder that also operates in Nashville and ranks 14th among privately held homebuilders in our HousingWire Homebuilder Rankings. According to Sandlin, the company expects to close roughly 530 homes and generate about $430 million in revenue this year, with its business concentrated largely among second- and third-time move-up buyers and 55-plus customers.

Signature’s answer to discipline and operational agility in a difficult market centers on product, but it starts with monthly customer research and a land strategy that spans design, estimating, purchasing, construction, warranty, and the company’s employee stock ownership plan.

Sandlin’s objective is to create homes compelling enough to drive sales without relying on discounts, then build them with enough speed, rigor and predictability to turn that demand into attractive returns.

“Our opinion is the folks who do will have an advantage of gaining market share — even if the market is smaller,” Sandlin said.

Creating demand before managing it

Sandlin does not regard production efficiency, nor even velocity, as substitutes for demand. Signature can build a house in 100 days, but there is little economic advantage in doing so if the company has not first created a product somebody wants to buy.

“The real genesis of our success is market research every month to monitor homes and constantly making changes to our floor plans to exceed market expectations,” Sandlin said.

Signature’s sales results indicate the strategy has been working despite the broader market slowdown. The company recorded 304 net orders in the first half of 2026, including 161 in the second quarter, a 19% increase from the same quarter a year earlier. It ended June with 266 homes in backlog, representing $220.5 million in future revenue.

The company’s current product mix spans a wide price range. Signature expects to build roughly 150 townhomes this year at an average price of about $425,000, Sandlin said, while its detached homes push the company’s overall average selling price above $800,000.

Its community-level performance also reflects the range. Everlee, Signature’s large Birmingham community, generated 533 closings through June, with an average selling price of about $578,000 in 2026. Poplar Farms in Franklin, Tennessee, was producing an average selling price of nearly $1.27 million and a 32.1% gross margin, while Reeds Vale in College Grove carried an average selling price above $1.4 million and a 40.6% gross margin as it approached closeout.

Sandlin readily acknowledges that the unusually profitable Reeds Vale closeout boosted first-half results and will make the second half harder to compare. The larger point, however, is that Signature has continued to generate sales without resorting broadly to the price discounting that has become commonplace across much of new-home construction.

The economics of 35 days

Once Signature has a buyer, Sandlin’s attention shifts quickly from creating demand to converting it into cash.

The number around which much of the company now organizes itself is 100: Signature aims to move a home from what it calls “green plate” through “punch,” i.e. pre-delivery inspection in 100 days or less, while maintaining the quality needed to protect the customer experience.

Sandlin did not always believe cycle time could have such a significant impact on profitability. After hearing Shinn Group founder Emma Shinn discuss inventory turns with a builder group in 2022, Signature began unpacking and retooling its construction process more aggressively. By 2023, reducing construction duration had become a major company initiative.

Signature has since shortened its construction cycle by about 35 days. Sandlin calculates that if those days were factored back to the company’s current operations and overheads, EBITDA would be nearly 30% lower, assuming gross margins remained at their 2022 level.

“I honestly did not believe the effectiveness would be as significant as it proved to be,” Sandlin said. “But I am a true believer in Shinn Consulting.”

The lesson changed the way he thinks about construction velocity. For Signature, cycle time is hardwired as an operational measure that determines how quickly inventory converts to revenue, how much capital remains tied up in homes under construction, and how effectively the company can translate backlog into earnings.

For an employee-owned company, Sandlin has also made the connection to his workforce and team member accountability explicit.

“As we have discussed, the key to profitability for our ESOP is to have backlog of sales and then build homes in 100 days or less,” he recently wrote to Signature’s estimators and field construction team. “This isn’t a request. It is a mandate because without 100-day homes we cannot achieve our goal of maximizing YOUR ESOP ACCOUNT.”

Making 100 days repeatable

The important part of Signature’s 100-day target is not the number itself. It is the operating consistency and excellence required to make that number repeatable across hundreds of homes, particularly as Signature continues to pivot its products to keep pace with what buyers want.

The company’s most important production target occurs early in construction. Signature aims to hang drywall within 40 days after determining that framing and rough mechanicals were the most volatile parts of its construction process and therefore offered the greatest opportunity to reduce cycle-time variation.

“If we can make this time, the 100-day home is pretty easy,” Sandlin said.

That has required Signature to push responsibility for construction duration well beyond its superintendents. Plans, engineering, estimating, and design are measured against the same objective because an error made before construction begins can cost several days once trades are working in the house.

Signature’s CRM and construction schedule are expected to remain accurate in real time. Each week, the company publishes schedules for individual superintendents, providing operating visibility and tapping into what Sandlin describes as the competitive nature of his field teams.

The company has also rigorously codified quality assurance for major trades. A superintendent must verify quality before funds are released to a vendor, an approach designed to catch seemingly minor defects before they become schedule disruptions.

Sandlin likes the example of a light fixture installed six inches from its proper location. Correcting the mistake can involve three vendors and take three days, turning a small quality miss into a measurable financial and production problem.

Signature also uses a paperless purchase-order system shared with its vendors. Every Thursday, its builders establish a “Hard Five” schedule that assigns specific installation dates to trades for the following week, eliminating much of the telephone scheduling and ambiguity that can introduce variation into a construction cycle.

Turning mistakes into operating knowledge

The next stage of Signature’s effort may be more difficult because it asks employees to change how they respond when something goes wrong, and take on a bigger chunk of business outcome accountability.

Sandlin has focused particular attention on variance purchase orders, or VPOs, which often signal that something in the plans, estimating, purchasing, or construction process did not go as intended. His message to employees is characteristically direct:

“VPOs are the nemesis of time and 100-day quality homes is nirvana.”

But Sandlin does not want the company’s reporting systems to become scoreboards that simply identify who finished first and last. It’s not about gamifying accountability. He wants the data to force employees to discern why a variance occurred and how the system can prevent it from recurring. It’s recursive learning at human scale.

“When you get VPO, I would like you to stop and think,” he told employees. “The question I suggest you ask: What could I have done personally to not have this VPO?”

Sandlin has expanded that idea into a voluntary internal initiative he calls the “100% Club.” Employees who participate commit to sharing what they learned each week and explaining how that knowledge can improve the company. It’s practices like these that distinguish between a learning-system flywheel and a self-confirming vicious circle, or echo chamber.

The concept reflects Sandlin’s fascination with compounding. He cites Warren Buffett’s description of compound interest as an extraordinary force and applies the idea as readily to organizational knowledge as to financial capital.

“Each time you achieve a higher level of competency you can improve again,” Sandlin said. “And over time the compounding improvements have exponential improvements.”

Where customer experience meets the income statement

The results reported to Signature’s lenders explain why Sandlin is pressing the organization to keep improving rather than treating its recent performance as validation of a finished playbook.

Through June, Signature generated $178.3 million in revenue, up 16% from a year earlier, while net income increased 63% to $23.5 million.

Yet one of the more revealing measures of Signature’s model does not appear on that income statement.

Sandlin says referrals and repeat purchasers account for close to 50% of sales in Birmingham and roughly 30% in Nashville. Existing Signature homeowners buy from the company again, and Sandlin believes the builder’s reputation has also made it a preferred choice among resale agents.

That makes warranty an unusually important part of Signature’s marketing strategy. Sandlin considers warranty spending a true marketing expense because a well-executed post-closing response can influence whether a homeowner recommends Signature or buys from the company again.

Sandlin consistently describes the production target as a 100-day quality home rather than simply a 100-day home. Faster inventory turns improve the business’s economics, but speed that causes errors or an unhappy homeowner would undermine the referral engine that Signature depends on to replenish its backlog.

The harder version of continuous improvement

Signature now intends to add technology to that operating system. Sandlin points to Higharc as a way to create more flexibility in plans, while a new customer-facing application is intended to let buyers visualize their options and understand the associated prices from home.

For a company that presells roughly 85% of its homes and offers customers extensive choices without becoming a custom builder, that capability addresses a specific operational challenge. Signature wants to preserve the emotional appeal and choice that help sell the home without allowing complexity to undermine production predictability.

The two, complexity and disciplined predictability, are binding. Sandlin expects Signature to continue changing its homes because he believes a better product is necessary to compete for a shrinking pool of buyers. Every new plan, option, and design feature, however, creates another opportunity for an error to enter the construction system. His strategy, therefore, faces an inherent challenge: Signature needs to become more responsive to customers while also becoming more standardized and predictable in execution.

Homebuilders cannot control mortgage rates, the lock-in effect or the number of households that decide to move next year. They can control how closely they study those remaining buyers, what they put on the lot, how accurately they price and document it, how quickly they build it and what happens when the homeowner calls after closing.

And, they can control the organization itself: its capacity to make good decisions, learn quickly and repeatedly, and execute consistently. A difficult market has a way of exposing what a company really is. It reveals where profitable growth hid weakness, where cost outran value, where communication broke down, where leaders became bottlenecks and where a customer was paying for something the company valued more than the customer did.

Sandlin’s bet is that capabilities and improvements within Signature Homes’ control become more valuable, rather than less, when the market shrinks.

The evidence at Signature Homes so far is that product innovation and operating discipline do not have to pull against each other. The company is attempting to make them compound: a better product generates backlog; backlog makes faster inventory turns more valuable; disciplined construction protects quality and margin; and a strong customer experience creates the referrals that help generate the next sale.

In a market Sandlin does not expect to improve materially, that cycle is not a temporary response to the downturn. It is the business he believes Signature will need to run better every year.