2020 New-Home Sales Hit 14-Year High

New single-family homes sold nearly 20% more in 2020 than in 2019, likely due to the shortage of existing homes on the market. According to Zillow, last year was the best year for new-home sales since 2006, thanks to low mortgage rates, low inventory, and the pandemic. A new-home’s attractiveness may have grown due to Americans’ increased awareness on health and wellness. About 811,000 new-homes sold last year–an 18.8% increase compared to 2019. But the thirst for new-homes is predicted to continue through 2021.

The supply of new homes for sale has been picking up lately, but remains low compared to historic norms — which is likely to incentivize builders to increase their activity, particularly when demand for housing remains solid. Expect the future permit and starts pipeline to be quite full this year. With a banner year in the books, today’s new home sales report set the stage for a solid start to 2021.

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