Are New Homes Selling?
While the real estate market has been struggling, the once highly desired new home has taken a back seat in the minds of the consumers. The foreclosures, fixer-uppers and short sales seem tantalizing to today’s homebuyers.
The existing home sales are down about 3 percent in the last year (latest data from the National Association of Realtors). However, according to the US Census new home sales have fallen 28 percent. New homes are currently more expense than the existing homes, as many of the existing homes are selling at deep discounts. These discounted homes accounted for 40 percent of the sales in February of this year.
The mindset of the consumer has changed also. During the boom years the consumer was more interested in top of the line appliances, expensive counter tops, and abundant square footage. Today’s consumer has become more cost conscious, and is looking at homes that are less expensive to heat and cool, and homes closer to the city, to cut down on gasoline costs.
There is a bright side to the story. There are some builders who are offering these new homes at cost, as their builder loans are coming due and they choose not to default on the loans. This is not widespread, but a consumer could luck out and obtain a brand new home at a great price.