Think New Homes Cost More? Not Right Now
Most people think a newly built home costs more than an existing one. But right now, that’s actually backwards. Newly built homes are more affordable than existing ones in a lot of markets. And that’s because builders are cutting prices and stacking on incentives to try to keep their inventory moving. Here’s why that’s really important for any would-be homebuyer to know. Newly Built Homes Are the Better Deal Right Now According to the latest data from the Census and the National Association of Realtors (NAR), a newly built home now typically costs about $40,000 less than an existing one ( see graph below ): Builders aren’t like homeowners who can wait for the right offer. Unsold homes cost them money as long as they sit empty. So, builders cut prices and add incentives to keep them moving. That trend has carried into August. NAHB’s latest numbers: 35% of builders cut prices, with an average reduction of 6%. 63% offered incentives like covering closing costs or buying down yo...