Sales of newly built, single-family homes jumped 5.8% in November to a 640,000 seasonally adjusted annual rate, but year-over-year new-home sales are down 15.2%, according to NAHB Eye on Housing. Elevated construction costs and lingering supply chain hurdles have sent the median price of a newly-built single-family home to $471,200, up 9.5% from a year ago.
Not only are prospective homebuyers discouraged by inflated price tags, but builders are also weighing the costs of new-construction projects. As demand wavers, the total share of homes available for sale is up to 461,000, an 18.2% year-over-year gain.
The impact of higher construction costs has made building entry-level homes particularly difficult. In November 2021, 13% of new home sales were priced below $300,000. That share has now fallen to 7%.
A year ago, there were just 32,000 completed, ready to occupy homes available for sale (blue area below). By November 2022, that number increased to 64,000, reflecting flagging demand and more standing inventory due to lower sales.
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