As homebuyers continue to face a shortage of existing homes for sale, demand for new homes continues to be strong, and some regions of the country — including Sun Belt states — are producing new homes at a relatively rapid pace.
A study released Thursday by the fintech and personal finance website Intellectual assets In-depth research Zillo New home sales data. A key takeaway is that while new construction creates additional supply for first-time and move-up buyers, it also comes with additional costs.
“While many metro areas currently have the advantage that you can purchase a new construction home at a similar price or even below the area average, there is still a 23.8% premium on new construction homes nationwide,” said Jaclyn DeJohn, a certified financial advisor. planner and editor-in-chief of SmartAsset, wrote in an email house line. “The average U.S. home sales price in March was $335,170, while the average new home sales price was $414,990.”
SmartAsset noted that U.S. inflation, as measured by the Consumer Price Index, rose 22.9% from spring 2019 to spring 2024.
In March 2024, four of the top 10 metro areas in the United States for new single-family home and condo sales were in Texas. Houston topped the list with 1,751 sales and a median price of $347,990. Dallas ranks second (1,574 units sold), San Antonio ranks fifth (777 units sold), and Austin ranks seventh (750 units sold).
The other metros in the top 10 for sales are also Sun Belt markets that have seen significant growth since the COVID-19 pandemic began. These include Atlanta, Phoenix, Charlotte, Nashville, Tampa and Raleigh.
Among the top 15 metro areas with the most new home sales in March, median prices ranged from $310,446 in San Antonio to $624,995 in Washington, D.C.
“The location and price of new homes sold depends on the demand and supply functions,” DeJohn explains. “As well as factors such as existing stocks, interest rates and immigration patterns, supply-side factors such as the cost of building materials and the availability of skilled labor also play a role and vary widely from place to place.”
SmartAsset also compares the sales prices of new homes and existing homes. The survey found that San Jose had the highest median new home sales in March, at $1.735 million. Heber City, Utah (a suburb of Salt Lake City) ranked second with a median price of $1.375 million, despite having only 51 new home sales in March.
San Francisco, Los Angeles, Miami, New York City, Boston, San Diego, Seattle and Sacramento also rounded out the top ten most expensive cities for new homes. Miami had the largest price difference between new and existing homes sold that month, with a gap of nearly $490,000.
Data released on Thursday U.S. Department of Housing and Urban Development (head-up display) and U.S. Census Bureau Data show that the private housing construction rate increased by 5.7% from March to April. But this growth is driven by multifamily housing (properties with five or more units). Single-family housing starts fell 0.4% this month, and the number of single-family housing permits issued fell 0.8%.
There is better news for the real estate industry in the form of completed units. On a seasonally adjusted basis, total completions rose at an annual rate to 1.623 million units, the second-highest monthly figure in 15 years. The growth was driven by single-family home completions, which increased 15.4% from March to April.
“The housing shortage is not going away,” said Lawrence Yun, the firm’s chief economist. National Association of Realtors (NAR) said in a statement. “The laws of supply and demand tell us that house prices are on solid footing and may even accelerate again in the future unless more is done to increase supply.”
