May’s new-home sales proved modest gains both month over month and year over year, according to Zonda’s New Home Market Update (NHMU). However, margins are thinner.
New-home sales increased 0.8% compared to April and 1.7% compared to May 2025. Zonda’s new-home metric shows that there were 726,037 new homes sold in May on a seasonally adjusted annualized rate. On a non-seasonally adjusted basis, 64,669 homes were sold, which is 2.5% higher than last year and 16.4% above the same month in 2019.
“While incentives are still widely used today, builders are being more thoughtful about how they present them,” says Ali Wolf, chief economist for Zonda and NewHomeSource. “A year ago, many builder websites almost felt like spam with incentive pop ups and price cuts advertised. Today, there’s more of a shift towards using incentives to close deals rather than to drive traffic.”
Zonda’s New Home Pending Sales Index (PSI), which accounts for fluctuations in supply by combining both total sales volume with the average sales rate per month per community, was 136.6, representing a 5.3% increase from the same month last year. The index is currently 21.6% below cycle highs and on a month-over-month basis, seasonally adjusted new-home sales increased 1.7%.
The markets that posted the best numbers compared to last year were Salt Lake City (+43.1%), Los Angeles/OC (+20.2%), and Cincinnati (+18.8%). Salt Lake City was up compared to last year and grew 10.8% month over month, Zonda notes. In contrast, the metros that performed the worst year over year were Baltimore (-13.7%), Las Vegas (-12.8%), and Raleigh (-11.7%).
National home prices increased 4.2% year over year for high-end homes to $950,995. Prices fell 2.7% for entry-level to $318,314 and 0.7% for move-up to $514,917. Zonda says the rise in high-end home prices reflects new communities opening at higher price points, improvements in design quality, larger lots and home sizes, and/or better locations.
In May, 21% of builders lowered prices in May month over month, 66% held prices flat, and 13% raised prices. Additionally, 62% of new-home communities offered incentives on to-be-built homes and 79% on quick move-in supply. These are only publicly available incentives so will underrepresent overall usage, Zonda points out.
The Zonda Market Rating, which accounts for both sales pace and volume, indicates an “average” market nationally compared to historical performance. Across Zonda’s top 55 major markets, 27% were “overperforming,” 44% were “average,” and 29% were “underperforming.”
National quick move-ins (QMIs) totaled 33,849 in May, down 8.2% compared to last year and 3.5% lower month over month. Total QMIs are 65.7% above 2019 levels.
On a metro basis, 44% of Zonda’s select markets increased QMI count year over year. The markets that increased the most were San Francisco (+86.1%), Cincinnati (+43.3%), and Philadelphia (+23.6%). Compared to 2019, Cincinnati, Sacramento, and Las Vegas have seen the most growth in QMIs, up 273.3%, 229.6%, and 179.6%, respectively.
