Key Takeaways:
- In 2020, a majority of homebuyers preferred new construction—but we’ve now seen a shift towards existing homes.
- Volatile lumber prices and a slower building process might be the reasons behind this unexpected trend.
- No matter what type of home you’re looking to buy, Linda Craft & Team are here to help you navigate the hot Triangle market.
Here’s Why New Construction Homes Have Fallen Out of Favor
In April 2021, the National Association of Home Builders (NAHB) posted an article, Home Buyers’ Preferences Shift Towards New Construction, which asserted that 60% of buyers would prefer a new build instead of an existing house. However, it seems that home-seekers have already changed their opinions over the last few months. A new Consumer Confidence Survey reveals that existing homes now have a surprising advantage—and we found a few reasons to explain this sudden switch.
New data shows that buyers’ preferences have changed
First, let’s take a look at some data. The latest Consumer Confidence Survey reveals the percentage of Americans planning to buy a home in the next six months is virtually the same as it was back in March. However, the percentage that plan to buy a newly constructed home is lower for that same period. The NAHB confirmed these findings in their updated second quarter report in June, explained by the graph above.
Buyers want to close on their homes faster
In today’s fast-paced market, many buyers are looking to move quickly and have everything taken care of on a tight timeline. However, builders cannot always guarantee when a home will be ready due to supply chain disruptions. Materials like lumber and appliances can take months to arrive, which pushes back a move-in date indefinitely.
If you buy an existing home, you won’t have to wait around for it to be completed. Chances are, it’ll also come equipped with all of your essentials, including appliances.
Building a home comes with unexpected costs
With the price of land, labor, and lumber being so volatile, many builders now include an escalation clause in the price negotiation to cover rising expenses. In certain situations, you could end up paying more for your home than what you originally agreed upon. This can be bad news for buyers, especially those looking to stick to a budget.
With an existing home, the final price is negotiated upfront, so you won’t need to prepare for unexpected expenses.
Current homeowners can take advantage of this switch
If you currently own a home and want to sell soon, this shift could help you capitalize on your equity. Even if your place isn’t completely move-in ready, it could still be an attractive option for local Raleigh buyers. You can also secure a higher price if you include your fridge, range, washer, or dryer!
Home prices have reached record highs in the Triangle, and there’s never been a better time to list. And if you aren’t quite ready to make a move, it’s never a bad idea to contact an agent for some advice.
Buy or Sell with Raleigh’s Top Real Estate Team
Whether you’re interested in buying new construction or an existing home, contact Linda Craft & Team at 919-235-0007 to get started. We have the tools you need to stand out in today’s competitive market, and we can even help you sell your current home for top dollar.
Ready to get started? Check out your current home’s value with our free estimate, or explore our buyer resources for more details.