While the overall supply of homes for sale has increased slightly from last year’s historic lows, the share of newly built homes remains elevated. This is partly due to builders working through a backlog of homes started during the pandemic boom.
The increased availability of new homes offers a potential benefit for buyers struggling to find affordable existing homes. However, the high prices of new homes and the elevated mortgage rates present ongoing challenges for many prospective buyers.
In March, there were 8.3 months of supply for new-construction homes compared to only 3.2 months for existing homes, indicating that while new homes are more readily available, they may not be moving as quickly due to affordability concerns.
The Redfin report also noted that while some markets, like Las Vegas, have experienced a cooling down with sellers offering concessions and negotiating on price, others, like San Jose, California, remain highly competitive, with most homes selling above asking price.
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