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In the fourth quarter of 2023, 31.8% of single-family homes for sale were new construction, comparable with 31.9% in 2022, which is the highest level of any fourth quarter on record.

According to a new report from Redfin, because of the increase in home building since 2009 and the pandemic boom, new homes on the market are taking up a larger share.

Over the last year and a half, as mortgage rates started rising in 2022, the number of homeowners selling their existing homes also decreased, which pushes the compared new homes on the market to a higher share.

“Newly built homes are selling quickly right now because builders are offering such good discounts,” says Heather Mahmood-Corley, a Redfin Premier real estate agent in Phoenix. “I recently had a buyer who wasn’t interested in a new construction home, but the builder offered such a good rate–5.25%–that they couldn’t afford not to take it. Another one of my buyers got a $10,000 credit for closing costs from a builder.”

Home builders have been offering large concessions including money for mortgage rate buydowns, which has made it hard for some individual sellers of existing homes to compete for buyers. While selling with discounts, these new homes are being offered at a higher price tag, according to to Christine Kooiker, a Redfin Premier real estate agent in Grand Rapids, Michigan.

“One of the builders in Grand Rapids that focuses on entry-level homes now has prices in the mid-$300,000 range,” Kooiker says. “Not long ago, buyers could get a new construction home here for $250,000 or $300,000.”

In 2022, roughly 2 of every 5 (42%) new single-family homes that sold went for $500,000 or more, up from under one-third (30%) in 2021 and 18% in 2020.