Buyers can expect the coming months to be the most competitive buying season in years, largely because not enough new homes were sold this winter to quell the demand, according to a new report from realtor.com.
About 618,000 newly constructed homes were sold in February, down 0.6 percent from January and up only 0.5 percent from February 2017 according to a joint report by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. Just about one in 10 home sales now is for a new home, according to Danielle Hale, chief economist for realtor.com, while in a normal market, it’s one in seven.
“There is plenty of room for growth,” she said. “More new-home sales are needed to restore balance in the housing market.”
The median price of newly constructed homes increased to $326,800 in February due to high land, labor and material costs, while the median price for an existing home was $241,700. Only about 13 percent of the newly constructed homes sold in February cost less than $199,999, with 58 percent sold between $200,000 and $399,999.
The South had the most recent new-home sales, with about 338,000. The West followed, with about 164,000 new homes sold, and the Midwest, with 79,000. The Northeast had the fewest amount of new-home sales at about 37,000.