Demand for New-Home Construction on the Rise as Existing Supply Dwindles

The share of buyers looking for new construction rose to 21% and 27% in the second and third quarters of 2022 after bottoming out at 19% in the first quarter of the year, NAHB Eye on Housing reports. While the inventory of existing homes on the market is unchanged year-over-year, the total supply of new homes for sale is 25% higher than a year ago, giving prospective buyers more options in the new-home market nationwide.

From the Q2 to Q3 2022, the total share of prospective buyers looking to purchase a new home rose in all four regions of the U.S., jumping from 18% to 27% in the Northeast, 12% to 18% in the Midwest, 20% to 26% in the South, and 30% to 31% in the West.

A possible factor behind this trend is that the inventory of new homes for-sale is 25% higher than a year ago, while the supply of existing homes on the market is unchanged.

From the second to the third quarters of 2022, the share of prospective buyers looking to purchase a new home rose in all four regions: Northeast (18% to 27%), Midwest (12% to 18%), South (20% to 26%), and West (30% to 31%).

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