A common belief is that new construction homes come at a premium. They often feature modern designs, builder warranties, fewer immediate repairs, and community amenities, all factors that can drive up their prices compared to resale homes. However, this isn't always the case.
Depending on the market, new homes can be competitively priced relative to resale properties and, in some instances, are more affordable.
“Nationally, new homes used to cost 20% more money than resale homes,” says NewHomeSource chief economist Ali Wolf. “Now, both types of homes are coming in around the same price, depending on the market. As a bonus, the builder might be willing to give you an additional financial incentive, like a mortgage rate buydown or design credit, to purchase with them today.”
March 2025 data from Zonda indicate the extent to which specific markets contribute to the spread between new and existing home prices. In some markets, new homes are a better deal, while in others new homes still command a much higher price.
Where New Comes at A Discount
A few markets stand out for flipping the conventional pricing script. The negative spreads may reflect smaller home sizes or slightly farther-out locations, but for buyers, this still translates to real savings:
Bay Area: New homes were 15.4% less expensive in San Francisco in March than resale homes, a difference of nearly $180,000. Similarly, new homes in San Jose were 11.4% less expensive than resale homes.
Austin, Naples, and Charleston: In Austin, new homes were 9.0% cheaper than existing homes; Naples Florida; and Charleston, South Carolina; saw new homes priced at a 8.2% and 7.6% discount, respectively.
Mountain Markets: Provo, Utah and Fort Collins, Colorado offered more modest discounts of 3.5% and 2.6%, respectively.
Markets With Small Premiums
In other markets, new homes still carry a premium, but the difference is much smaller than in recent years. Oftentimes, this small gap may be enough to be offset by builder incentives, lower maintenance, and energy savings. Four markets experienced premiums below 5%:
Raleigh (0.6%)
Washington, D.C. (1.7%)
Cape Coral, Florida (2.9%)
Reno, Nevada (4.1%)
What This Means
Whether you are a first-time buyer or a move-up buyer, it pays to check market-level data. A new home might offer better value or even a lower price than an existing one. Additionally, new construction doesn’t always mean a long wait. With builders offering a large number of quick move-in (QMI) homes, these new houses on the market are ready to move in on a similar timeline to resale homes.
If you have previously ruled out new construction due to perceived high costs, it may be time to reconsider. Data suggests the gap between new and existing is smaller than expected, and in some markets, it is entirely reversed.
