Redfin reported on Tuesday (10-31-23) that according to its data, 30.6% of US single-family homes for sale in 2023Q3 were new construction. That is the highest share of any Q3 on record and up from 28.9% in 2022Q3 and 25% in 2021Q3.
According to Redfin analysis, newly built homes have taken up a growing share of for-sale housing inventory partly because building has increased and partly because the number of existing homeowners putting their houses up for sale has decreased as mortgage rates have surged to a 23-year high of nearly 8%.
High mortgage rates have pushed a lot of buyers to the sidelines, Redfin said, but many of the buyers who are in the market are opting for new construction homes because builders are handing out concessions, such as mortgage rate buydowns, in order to attract bidders and offload inventory.
Purchases of single-family homes jumped 12.3% last month—the fastest pace since early 2022. The latest run up in mortgages could slow new-home construction, according to Redfin.
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