Jan 20 (Reuters) - U.S. homebuilder D.R. Horton ( DHI ) posted first-quarter profit and revenue above Wall Street's estimates on Tuesday, as its incentive offers for buyers and the Federal Reserve's interest-rate cuts boosted home sales.

Homebuilders in the U.S. have ‌been leaning on mortgage rate buydowns, and offering smaller and cheaper home options, to lure ​customers who have delayed home buying due to high inflation.

The ‍incentives helped the company to drive a 3% ⁠increase in its ⁠net sales orders to 18,300 homes in the first quarter ended December 31.

Shares of ‌the company were up 4% in ​premarket trading.

"We expect our sales incentives to remain elevated in fiscal 2026," said Executive Chairman David Auld. He ⁠added that affordability pressures and ‍cautious consumer ​sentiment were still pressuring demand for new homes.

The average rate on the popular 30-year fixed-rate mortgage declined to 6.06% as ‍of January 15, 2026, the lowest level in more than three years, mortgage finance agency Freddie Mac said. It averaged 7.04% during the same period a year ago.

U.S. President Donald Trump earlier this month ordered government-sponsored Freddie Mac and Fannie Mae to ​buy $200 ‍billion in mortgage bonds, in an attempt to drive down borrowing costs.

Trump has also proposed barring institutional investors from ​buying single-family homes, a move the White House said would ensure more inventory remains available for everyday American families. Trump announced the proposal in a Truth Social post, writing, "People live in homes, not corporations."

D.R. Horton ( DHI ) posted a profit of $2.03 per share in the first quarter, above estimates of $1.93 per ​share, according to data compiled by LSEG.

The Arlington, Texas-based company's revenue fell to $6.89 billion from $7.61 billion a year ago, but came above analysts' estimate of $6.60 billion.

(Reporting by ‍Aatreyee Dasgupta and Abhinav Parmar in Bengaluru; Editing by Shinjini Ganguli)