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Demand for New Construction Homes is on the Rise

Read Time: 1 Minute January 24, 2025

Sales of newly built homes are outpacing the sale of existing homes, signaling buyer interest in new construction. New home sales increasing almost 9% year-over-year in November 2024,1 while existing home sales increased 6.1% year-over-year in the same month.2

New home sales hit a seasonally adjusted rate of 664,000 houses sold in November, per the Census. This is also an increase from the previous month of 5.9%.1

Meanwhile, the sale of existing homes – homes that were owned by someone else before being sold, rather than being new builds – also increased, albeit at a slower pace of 6.1% year-over-year, per the National Association of Realtors®.2

This could be a promising sign for builders, as many new residential building projects kicked off in December. Housing construction starts increased 15.8% in December over the previous month, according to the Census.3 However, the latest stats on builder confidence from October 2024 are still tepid, hovering around 43%.4

What Does This Mean?

The increased sales of both new and existing homes suggests more people are entering the home buying market overall, which could mean people are feeling more confident about their home buying prospects. But beyond that, new housing supply could be creating new opportunities for buyers.

This tracks with the trends we’re seeing – as we’ve covered in a previous article, experts predict housing supply could edge upwards in 2025, giving home buyers more options and encouraging more people to enter the housing market.5 Industry pros expect this even though housing prices are expected to experience moderate growth.6

Should I Buy a New Build?

If you’re looking to buy a home, whether you buy a new or existing home will depend on your priorities, including cost, location and timeline. For more tips on deciding whether you’d like a new or existing home, read this article.

Whatever you decide, know that Newrez has great mortgage products for all sorts of circumstances. Reach out to one of our mortgage experts today and they’ll be glad to walk you through your options.

 

National Association of Realtors® is a registered trademark of the National Association of Realtors and is not affiliated with Newrez LLC.

References:

1 New Residential Sales Press Release

2 Existing-Home Sales

3 New Residential Construction Press Release

4 Home Builder Confidence - Charts and Data

5 forecast-commentary-nov-2024.pdf

6 Housing Market Predictions for 2025: What's Next for Buyers and Sellers | Zillow

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