New Construction Prices
New construction prices are different. When I quote market stats, I generally only talk about resale homes as I specifically exclude new construction. So let’s talk about some new construction stats. While the resale market prices peaked last May, new construction prices peaked in August. Since then, new construction prices have come down 9% while resale homes have come down about 23% from their peak. A big reason for this difference is that many new construction homes go under contract while the house is being built so the time from contract to close is long. As prices in the market came down last year, many buyers were already locked into prices with the builder. Though builders began to lower their prices, it took a while to see that cycle through the system. The result, a later peak and slower decline. When the market turns back around, you’ll see the same lag, but in reverse.