The U.S. new home market is showing signs of strain, but not surrender. According to Zonda’s latest New Home Market Update for February 2025, national sales are down nearly 12% year-over-year. Yet, the market is still holding the line at an “average” performance, buoyed by a flood of buyer incentives and a surge in quick move-in (QMI) homes.
Market dynamics vary significantly depending on builder size, region, and buyer type. Larger builders are outperforming smaller competitors. Midwest markets are proving more optimistic than those in Florida. And wealthier buyers continue to show resilience, for now.
But one trend crosses all lines: incentives. Consumers not only welcome them — they expect them.
In February, 56% of new home communities offered incentives on to-be-built homes, while 74% sweetened the deal on QMI inventory. Nationally, incentives averaged 4% of local home prices, often taking the form of mortgage rate buydowns, closing cost assistance, or design upgrades.
“There are good days and bad days in today's housing market,” said Ali Wolf, chief economist for Zonda and NewHomeSource. “Fluctuations in stock values, uncertainty about the labor market, and low housing affordability have consumers particularly concerned. For some, though, marriage and babies are a more powerful factor.”
A total of 666,568 new homes were sold in February on a seasonally adjusted annualized basis — down 1.9% from January and 11.6% from a year earlier. On a raw basis, 57,138 homes sold last month, marking an 11.4% year-over-year drop and a 1.6% dip from February 2019.
Despite the slowdown, home prices remain largely flat. Entry-level homes stayed steady at $329,229, while move-up and luxury homes ticked up just 0.7%, to $520,228 and $912,283, respectively. These figures do not account for differences in home size or location.
The spotlight now shines on quick move-ins — homes that can be occupied within 90 days — which are up 89.6% compared to 2019 and 17.5% higher than this time last year. Zonda’s newly introduced QMI-per-community metric reveals an average of 2.4 available per community, a 23% year-over-year increase. However, that number is slightly down from the 2022 peak of 2.5.
