Top 10 Cities With the Most New-Construction Homes—and They’re Affordable, Too

by Julie Gerstein

Buying a home entails a ton of decisions, from where to move to how many bedrooms you need and, increasingly, whether you want a new or existing home.

While new construction has traditionally been more expensive than existing homes, today’s builders have responded to shifts in the housing market by designing smaller, more affordable homes in recent years.

That’s closing the cost gap between new builds and existing homes. The median sales price for a new home in the U.S. was $420,600 in August, while the median sales price of existing homes was $416,700, according to a report from the National Association of Realtors®.

“Most of the new construction taking place is in areas that are more suburban or rural,” says Robert Washington, founder of Savvy Buyers Realty in St. Petersburg, FL. “Since the land being purchased by developers and builders is relatively cheap, new build prices can actually be pretty competitively priced when compared to similar existing homes closer to city centers.”

With new builds becoming more affordable and available, here’s what you need to know about buying one.

Where to find new-construction homes

If you’re considering buying new construction, look to the South. Cities across the Sun Belt are dominating the new-construction market right now.

Metro areas in North and South Carolina, Texas, Tennessee, and Georgia are among the markets with the largest share of new construction.

The boon in these areas makes sense: Sun Belt states saw a 10% increase in population during the COVID-19 pandemic, and experts predict the region will see an additional 19 million residents move to the area in the next 10 years (compared with just 3 million people in other regions).

“There is a clear and present need for newly built homes to meet the demand for housing, and this construction is an important contributor to overall economic activity,” says Realtor.com® economist Joel Berner in his recent analysis.

Metro areas in North and South Carolina, Texas, Tennessee, and Georgia are among the markets with the largest share of new construction.
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More homes to choose from

The influx of new housing stock is also a boon for buyers who skipped the competitive housing market of the past few years and are now coming off the sidelines thanks to lower mortgage interest rates.

“General market hotness has limited the number of existing homes for sale,” says Berner.

But in two cities in North Carolina—Spartanburg and Sanford—there are more new-construction homes for sale than existing homes.

“The Carolinas are well-represented … in our ranking of the most buyer-friendly states for new construction,” says Berner. “Buyers in these metros may have a tougher time in the existing-home space, as inventory is limited, but they may have more opportunities to buy a newly built home.”

Swelling listings pages lead to downward pressure on home prices. In several markets with the largest share of new-construction homes—Sanford, NC, Raleigh, NC, and Boise, ID—the median price of new-construction homes is lower than for existing homes.

New-construction perks

Still wondering whether new construction is worth it?

Buyers can also get a bargain by taking advantage of builder incentives, such as assistance with closing costs, material upgrades, and mortgage rate buy-downs, which offer a reduced interest rate to buyers who pay a one-time fee upfront. New-build buyers also generally have fewer costly repairs and renovations, and homes are more energy-efficient.

So where can you find the largest share of new-construction homes on the market and take advantage of increased inventory? Read on to find out.