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The share of newly built houses on the market is nearing a record high, according to a new report.
The report, released Monday by Redfin, found that one-third, or 33.4 percent, of single-family homes for sale in the United States during the first quarter were new builds, roughly double the levels seen before the pandemic but down slightly from the record high of 34.5 percent recorded two years earlier.
As homeowners with mortgages remain locked in to their low mortgage rates, new construction has provided a much-needed source of inventory in some markets. Some builders are also pricing new builds to sell, another lifeline for first-time buyers especially.
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“We have a fair amount of new construction homes for sale, and thank goodness we do,” Orlando-based Redfin Premier agent Nicole Dege said in a statement. “Buyers are having a hard time finding single-family homes in their budget because not many homeowners are letting go of their houses, and those who are listing tend to price high because they haven’t come to terms with the fact that prices have come down from their 2022 peak.
“Builders have a better understanding of the current market, so they’re pricing fairly, offering mortgage-rate buydowns and providing other concessions to attract buyers.”
For new construction homes, there was a supply of 8.3 months at the current sales rate, compared to just 3.2 months for existing homes, according to the report.
The report attributed the share of newly built homes decreasing slightly over two years to inventory creeping up slightly from last year’s bottom-out, as some homeowners accept the state of mortgage rates and list their homes for sale. At the same time, builders have eased up on construction due to high mortgage rates and the resulting drop in demand.
Many homebuilders are still trying to offload the glut of new houses they began building during 2021 and 2022 when the industry was booming.
