The headline may read, “Existing home prices outpace new homes nationally,” but the flip in recent years tells a different story regionally.
Normally, new homes are more expensive than existing homes. However, since the pandemic, the housing market faced an unusual accumulation of headwinds: buyers who bought with prime low mortgage rates are not willing to give them up, supply chain pressures and tighter inventory.
Now, new homebuilders are offering solutions such as building on smaller lots and incentives, among other solutions.
Yet, this headline is only relevant to specific markets like the West and the South.
Analysis from the National Association of Home Builders (NAHB) reports that in markets such as the Midwest and the Northeast, a new home being more expensive than an existing home is still the norm.
“The new home price premium was most pronounced in the Northeast, where new homes sold for $157,800 more than existing homes,” said Onnah Dereski, manager of Economic Services at NAHB. “Additionally, in the Midwest, new homes sold for $55,200 more than existing homes. The West and South set the national trend, with existing homes priced $90,200 more than new homes in the West and $18,100 more in the South.”
