Have High Home Prices Reduced Buyer Interest in New Homes?
The share of prospective home buyers looking to buy a newly built home peaked at 42% in the fourth quarter of 2020, before falling to 38% and 33%, respectively, in the first two quarters of 2021.
The drop is most likely the direct result of strong gains in new home prices in 2021, which have been driven by double-digit growth in the price of goods used in residential construction. These results come from NAHB's latest Housing Trends Report.
In contrast, the share of buyers looking only at existing homes rose from 31% in the final quarter of 2020 to 35% in the second quarter of 2021, while those who will buy either new or existing homes increased from 27% to 32% of all prospective buyers during this period.
Regionally, the share of buyers who would prefer a new home peaked in the Northeast and West in the first quarter of 2021 at 60% and 51%, respectively, before falling to 34% and 40% in the second quarter of the year.
In the South, the share peaked in the third quarter of 2020 at 33%, but is now at 30%. In the Midwest, the share peaked in the final quarter of 2020 at 27%, but is now down to 19%.
Rose Quint, NAHB’s assistant vice president for survey research, provides more analysis in this Eye on Housing blog post.
Latest from NAHBNow
Feb 18, 2026
Podcast: Live From IBS 2026 – A Special Home for a Special CauseIn the latest episode of NAHB’s podcast, Housing Developments, CEO Jim Tobin and COO Paul Lopez take center stage at NAHB HQ at the 2026 International Builders’ Show (IBS) in Orlando, with special guest Jason Eichenholz sharing his behind-the-scenes involvement with The New American Home.
Feb 18, 2026
Georgia Builder Elected to Senior Leadership of NAHBJim Chapman, an Atlanta-based real estate developer with more than 25 years of experience in the construction field, was elected today as 2026 third vice chairman of the National Association of Home Builders (NAHB) during the association’s International Builders’ Show in Orlando.
Latest Economic News
Feb 18, 2026
Overall Housing Starts Inch Lower in 2025Despite a strong finish in December, single-family home building dipped in 2025 as persistent affordability challenges continued to weigh on the market.
Feb 18, 2026
How Housing Affordability Conditions Vary Across States and Metro AreasThe NAHB 2026 priced-out estimates show that the housing affordability challenge is widespread across the country. In 39 states and the District of Columbia, over 65% of households are priced out of the median-priced new home market. This indicates a significant disconnect between higher new home prices, elevated mortgage rates, and household incomes.
Feb 17, 2026
Builder Sentiment Edges Lower on Affordability ConcernsBuilder confidence in the market for newly built single-family homes fell one point to 36 in February, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).