High Prices Deter Interest in New Homes
Rising home prices are causing prospective home buyers to reexamine their interest in new homes, according to the latest survey results from NAHB’s latest Housing Trends Report.
In the first quarter of 2018, only 15% of prospective buyers were looking for a newly built home. The onset of COVID-19 propelled that share up to 42% by the final quarter of 2020, but strong gains in new home prices have driven it down for the last three quarters, reaching 32% in the third quarter of 2021.
Meanwhile, the share of buyers who are ambivalent between new or existing construction has gone from 27% to 34% during this period.
Regionally, the share of buyers who would prefer a newly built home declined dramatically between the first and third quarters of 2021 in the Northeast (60% to 34%) and the West (51% to 39%). In the Midwest, the share peaked in the final quarter of 2020 at 27%, fell to 19% by the second quarter of 2020, but then rose slightly in third quarter to 21%. A more consistent 30% to 33% of buyers in the South have preferred a new home in the past five quarters.
Rose Quint, NAHB assistant vice president for survey research, provides more insight in this post from Eye on Housing.
Latest from NAHBNow
Digital Media | Membership
Jun 30, 2025
Top Builders List Spotlights NAHB MembersIn its latest May/June 2025 issue, Pro Builder unveiled its Top 200 (formerly Housing Giants) report, which ranks the top U.S. home builders by revenue, and looks at the top trends affecting the business of home building.
Legal
Jun 27, 2025
Supreme Court Limits Nationwide InjunctionsIn a case that could have far-reaching consequences for NAHB members, the Supreme Court today issued a 6-3 ruling that would limit the use of nationwide universal injunctions. A universal injunction stops the defendant from taking an action against anyone, anywhere.
Latest Economic News
Economics
Jun 30, 2025
2024 New Single-Family Starts by Census DivisionDespite persistently high mortgage rates, elevated financing costs for builders, and a shortage of buildable lots, single-family starts rebounded in 2024, following two straight years of declines.
Economics
Jun 27, 2025
2025 First Quarter State-Level GDP DataReal gross domestic product (GDP) increased in ten states in the first quarter of 2025 compared to the last quarter of 2024, according to the U.S. Bureau of Economic Analysis (BEA).
Economics
Jun 27, 2025
State and Local Property Tax Revenue Grows in the First QuarterIn the first quarter of 2025, state and local governments experienced an increase in property tax revenue growth. On a seasonally adjusted basis, state and local government property tax revenue grew 1.1% over the quarter, according to the Census Bureau’s quarterly summary of state and local tax revenue.