29% of US Single-Family Homes for Sale in Q3 Were New Construction—A Record High

Redfin, the Seattle-based real estate brokerage firm, is reporting that in 22Q3, 29% of US single-family homes for sale were new construction. This is the highest share of any Q3 on record. It is up from 25% in 21Q3 and 18% in 20Q3.

According to Redfin, newly built homes have been taking up a growing portion of overall housing supply since 2011, when building started to rebound after the financial crisis. That trend is now intensifying due to a surge in construction during the pandemic and a recent slowdown in existing homeowners putting their house up for sale.

Single-family housing starts rose 14% year-over-year in 2021—the largest increase since 2013. As a result, more single-family homes housing units were completed in 22Q3 than any other quarter since 2007. In September alone, the number of completed new homes for sale was up 19% month-over-month.

Redfin’s Deputy Chief Economist Taylor Marr believes that with a glut of inventory on their hands, builders will likely ease up on construction in 2023. “Homebuilders will take on a fewer new projects next years as the focus on getting their existing projects sold. Builders will also shift more toward multifamily units, for which there is still relatively high demand because rents remain high.”