New Home Construction Is Pretty Affordable in These 17 Cities
31% of U.S. single-family homes are newly built ones currently because of the state of the U.S. housing market.
According to the Street, those perks don’t have to come at a premium. In fact, in today’s high interest rate environment, some builders are even lowering prices on newly built homes to offload excess inventory, Redfin data journalist Dana Anderson wrote in a blog post.
Driving the surge in new construction was a combination of several factors, including the “pandemic homebuying frenzy” and rising interest rates, Redfin said.
During the pandemic, remote workers migrated for more affordable housing and created so-called pandemic boomtowns. Building permits for single-family homes shot up in 2021 and 2022, and many of those completed properties are now on the market, Redfin said. Meanwhile, the majority of single-family homeowners are locked in to lower mortgage rates, so fewer existing homes are for sale.
“For many homebuyers, new construction is a welcome option in today’s market —especially in the southern part of the country, where new homes tend to be more prevalent,” Anderson wrote.
Using data provided by Redfin, we’ve identified the housing markets where new-home construction makes up roughly one-third or more of the homes for sale, and the median sales price of those homes falls under $485,000.
In these cities potential homebuyers have a lot of fresh inventory to choose from — and it’s relatively affordable. The median sales price in the U.S. was about $440,500 in July, according to Redfin.