New Home Sales in Master-Planned Communities Decline as Affordability Concerns Mount
As price increases and interest rate hikes push prospective buyers to the sidelines, developers are seeing a marked drop in new home sales, but some master-planned communities are still reporting above average sales activity, RCLCO reports. Total new home sales among the nation’s 50 top-selling master-planned communities dropped by 18% year-over-year during the first half of 2022. Meanwhile, the average price among new single-family homes is up 15% year-over-year and over 40% since April 2020.
The Villages, an active-adult community in Florida, is once again the top-selling master-planned community in the U.S. with an estimated 1,500 sales year-to-date just halfway through 2022. The Villages is followed closely behind by Sarasota, Florida’s Lakewood Ranch, a multigenerational community that tallied a total of 1,026 sales in the first half of the year.
In our Year-End 2021 issue of RCLCO’s Top-Selling Master-Planned Communities Report, we reported that sales among Top-Selling communities increased modestly in the first half of the year before slowing in the second half of 2021. Supply chain disruptions, labor market tightness, and cost surges were among the most cited reasons for that modest growth in 2021 sales, though optimism remained strong for 2022 as demand remained strong and market participants hoped for the timely resolution of supply chain woes. That optimism was not rewarded and the slowing pace of new single-family home sales has continued through May of 2022, according to the most recent data available. Now, rising mortgage rates, which have gone up 2% since the beginning of the year, indicate the softening we have seen in the new home market may yet continue.