New Homes Are Cheaper than Existing Ones? Yes, But …
March Census Bureau data found that buyers paid less, on average, for a newly built home – but it’s skewed by a lack of existing-home listings in the starter-home range.
NEW YORK – March housing data from the U.S. Census Bureau found that the median price of a newly built home was slightly lower than the median price of an existing home. That hasn’t happened in more than 15 years.
However, it doesn’t mean buyers should now flock to new construction to find the best deals out there.
The national median price of a newly built, single-family home sold in March was $330,800, according to the Census Bureau, while the national median price of an existing, single-family home sold in March was $334,500, according to the National Association of Realtors (NAR).
However, consumers are unlikely to pay less for a new home because of a shortage of lower-priced homes on the market.
“On a per-square-foot basis, within comparable markets, a new home is still priced higher than an existing home,” National Association of Home Builders (NAHB) chief economist Robert Dietz. NAHB says first-time buyers represent a growing share of the new construction market, 43% in February, which is higher than the 31% share in the existing home market.
As builders finally start to focus on constructing entry-level homes, the median price for new homes is somewhat reduced. NAR notes that the number of existing homes priced between $100,000 and $250,000 that sold in March was down 10% from a year ago, while the number of homes priced between $750,000 and $1 million that sold was up 82% from a year ago. And sales of million-dollar-plus homes were up by 108%, skewing the median much higher.
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