Where Are Builders Paying the Most for Sales Incentives?
Sales incentives on unsold inventory have become increasingly common, making up an average of 10% of a new home's cost in some states
Jan. 23, 2025
Mark Trost VCNW via Getty Images
Sales incentives have become increasingly common for new-construction homes.
With home prices on the rise, home builders in recent years have been more willing to offer sales incentives to entice buyers. According to the ResiClub blog, which cites data from John Burns Research and Consulting, this is most prevalent for builders in Florida and Texas. For instance, in Florida, home builders are spending, on average, 10% for sales incentives on unsold inventory. On the other hand, builders in the Northeast are spending far less. There, home builders spend, on average, 3% of the sales price for incentives on unsold inventory.
Often, those new construction incentives are baked into the price; however, if a particular community or market shifts quickly, and a builder needs to rapidly increase incentives to keep selling homes, it’s essentially a net effective home price cut.Read more
