The average price of a newly constructed single-family home that sold during the third quarter was $374,000, according to new data from Redfin
, which also found newly-built homes sold at an average premium of $87,000 in the third quarter compared to existing homes.
However, Redfin found new home prices were up 3.3 percent year-over-year compared to existing home prices, which grew by 7.9 percent last month. Still, there are far fewer newly-built homes: one in eight homes for sale in September were new construction, compared to one in 13 five years ago.
Nashville had the highest portion of new home sales over the last three months, with 24 percent of all homes sold being new construction. Buffalo, N.Y., had the lowest share, at 0.8 percent. According to the U.S. Census, the national average cost to a builder constructing a new home was $240,000 for single-family units in August, the highest cost since the Census Bureau began reporting this data in 1988.
“After almost a decade of underproduction, we are finally seeing a slow, steady increase in single-family housing starts, up nine percent from a year ago,” said Redfin Chief Economist Nela Richardson. “But high building costs are limiting the construction of homes that today’s buyers can afford. This is why even in the midst of extreme inventory shortages for existing homes, new homes are sitting on the market instead of selling.”