North Columbus News

If they build it, will buyers come? That’s the question posed in a recent article in REALTOR® Magazine. Home builders believe they can better compete against the resale market by offering greater housing options and better costs. This is making more home buyers consider new homes—more than may have before. New-home construction has accounted for about a third of the national single-family inventory since 2021, according to The State of the Nation’s Housing 2024, a report released by Harvard University’s Joint Center for Housing Studies.

Fifty-three percent of new-home buyers say they specifically sought out only new construction when they started their real estate search; 39% considered both new construction and existing homes, according to realtor.com®’s 2024 New Construction Consumer Report. Millennials, ages 26 to 41, are most likely to be drawn to new home construction. However, all age groups share common appeals about buying a new home: having everything “new/never used,” getting modern floor plans, perceiving it as a better investment, and having the ability to customize features of the home.

While more than half of home buyers surveyed express concerns about high costs associated with new construction, builders argue that this need not be an issue. The cost gap between new and existing homes is shrinking: The median new-home price in May was $417,400 compared to $419,300 (an all-time high for existing homes).

Builders are also offering deals: Sixty-one percent say they’re willing and able to buy down mortgage interest rates, often bringing them into the 5% range (the current average is near 7%), according to a builder survey conducted by Zonda, a construction research firm. Furthermore, most homebuilders in June reported using sales incentives to attract buyers; nearly 30% said they cut home prices to bolster sales.

“There’s a tremendous opportunity for real estate agents in the new-home space,” says Amy Lessinger, president of RE/MAX LLC. “These days, many developers would rather deal with a buyer’s agent than directly with prospective buyers. An experienced agent has the skills to keep the purchase on track and help nervous buyers feel confident about their decision.”

Real estate agents can build up a niche in new-home sales by:

- Visiting new-home developments and learning each builder's floor plans and offerings.

- Attending builder association meetings and events like Parade of Homes.

- Enhancing their online presence with resources such as photos, floor plans, reviews, and community videos.

- Taking courses such as those offered by the Center for REALTOR® Development on representing new-home buyers.

For potential homebuyers considering building anew, Melissa Dittmann Tracey suggests sharing articles like "7 Things You Wish You Knew Before Building Construction" from HouseLogic.

Melissa Dittmann Tracey is an award-winning journalist covering real estate news and trends. She contributes regularly to various platforms including Real Estate Today radio show and podcast.