New builds actually a good deal right now..??

[Jake Andronico]

For the first time in a decade, builders—not everyday sellers—are the ones with properties on sale.

For the first time in more than a decade, new construction isn’t the “expensive” option. 

It’s often the better value.John Burns Research shows the new-build premium has flipped negative for the first time in modern tracking. In many markets, new homes are now trading below existing homes on a price-per-square-foot basis.

Why? 

Builders have levers individual sellers don’t:

- They can buy down rates into the mid-5s (I've seen as low as 3.875% recently in Reno, NV...) while resales sit at 6.5%+/-

- They offer closing cost credits without blowing up appraisals

- They price off absorption and carry costs, not emotions

- They HAVE to push product, no matter the market conditions

A good number of resale sellers are still anchored to 2021–2022 pricing, and DON'T have to sell. Builders are not. That gap is where the opportunity sits.

Are you guys seeing similar opportunities in your market?