Buying a home this spring? You’re probably navigating today’s affordability challenges and dealing with the limited number of homes for sale. What if there was a solution that could help with both?
If you’re having a hard time finding a home you love, and mortgage rates are putting pressure on your budget, it may be time to look at newly built homes. Here’s why.
New Home Construction Is an Inventory Bright Spot
When looking for a home, you can choose between existing homes (those that are already built and previously owned) and newly constructed ones. While the number of existing homes for sale has increased this year, there are still fewer available than there were in more typical years in the housing market, like back in 2018 or 2019.
So, if you’re looking to expand your pool of options even more, turning to newly built homes can help. As Danielle Hale, Chief Economist at Realtor.com, explains:
“The shortage of existing homes For Sale has opened up the possibility of new-home construction to more buyers who may not have once considered it.”
Starts, or homes where builders just broke ground, have seen a big increase lately. Completions, homes that builders just finished, are also up significantly. So, if you want a new, move-in-ready home, or you want to get in early and customize your build along the way, you have more options right now.
Builders Are Offering Incentives To Help with Affordability
To sweeten the pot, builders are offering things like mortgage rate buy-downs and other incentives for homebuyers right now. This can help offset today’s affordability challenges while also getting you into your dream home. Mark Fleming, Chief Economist at First American, explains why you may find builders have wiggle room to offer more for you than the typical homeowner:
"Builders aren't rate locked-in. They would love to sell you the home because they're not living in it. It costs money not to sell the home. And many of the public home builders have said in their earnings calls that they are not going to be pulling back on incentives, especially the mortgage rate buydown, so that will help the new-home market continue to perform well in the spring home-buying season.”
An article from HousingWire also says this about what builders are offering right now:
". . . the use of sales incentives still shows some momentum as 60% of respondents reported using them, up from 58% in February. "
Buying from a builder is different from buying from a home seller, so it’s important to partner with a local real estate agent. Builder contracts can be complex, and a trusted agent will be your advocate throughout the process.
They’ll be your go-to resource for advice on construction quality and builder reputation, reviewing and negotiating contracts to get you the best deal, helping you decide which customizations and upgrades are most worthwhile, and much more.
Bottom Line
If you’re struggling to find a home to buy or are facing today’s affordability challenges, we can connect you with a local expert to see if a newly built home could be the solution you’re looking for.