New homes sales are down 66%. Last month, there were 4.82 million existing home sales compared to the 481,000 new homes sales, making that a ratio of 10:1. Historically, the average is 6:1.
2. New Homes are Pricey.
In the past year, the median new home price increased 13.14% to $294,300. In January 2005, new homes costing $199,000 or less made up 43.5% of the market and homes costing $400,000 or more made up 17.4%. In the past month, new homes $199,000 or less made up 22.2% of the market and homes $400,000 or more made up 44.4% of the market, showing the dramatic increase in new home prices.
3. New Homes are Big.
As the prices of new homes rise, so do their sizes. In the past 10 years, newly constructed homes sized 3,000 square feet and above have gone from 19 to 31% of the market and homes of 4,000 square feet or more have almost doubled from 5 to 9%.
These trends show that builders are aiming at the wealthiest consumers. With a low number of home sales, builders have to have high prices, and for consumers to pay more money, they are going to want more expansive homes.