Shopping for a new home today may look different than it did a few years ago. In Zonda's October survey of builders across the country, 86% reported demand was slower than expected, while 14% said it was on track with or stronger than expected.
While demand remains subdued, builders continue to offer financing incentives that may help make purchasing a new home more manageable.
Incentives Are Still an Important Part of the Market
With mortgage rates continuing to weigh on affordability, builders have been using mortgage rate buydowns to try to make monthly payments more manageable. Zonda’s October survey found that builders offering buydowns commonly targeted rates ranging from the high 4% range through the high 5% range.
That makes it important to look beyond a home's advertised price when comparing communities. Ask what incentives are currently available, whether they apply to particular homes or financing programs, and how different options affect the total monthly payment.
Life Events Continue to Drive Purchases
Even in a slower market, buyers continue to move forward for a variety of reasons. Builders reported that recent purchases were often driven by life changes, including growing families, job relocations, marriage, and other household needs. Buyers with substantial financial resources or larger down payments also remained active.
That's a useful reminder for shoppers. You do not necessarily need to time the entire housing market. The more practical question is whether the homes, prices, incentives, and monthly payments available today work for your household and the reason you need to move.
Looking Ahead
The selection of new homes may change in the years ahead. Zonda's October survey found that more builders were putting land purchases on hold, suggesting some are taking a cautious approach to future development. That doesn't necessarily mean fewer homes will be available, but shoppers with flexible timelines may find it helpful to compare homes available today with those planned for future communities.
