People in Seattle Want Less Expensive Homes – And Builders Are Responding

In the current real estate market, potential homebuyers face two primary affordability obstacles: higher mortgage rates compared to recent years and increasing home prices due to limited housing supply. To tackle these issues, individuals are collaborating with their agents to explore more affordable housing options. Given that a significant portion of the current available inventory consists of newly constructed homes, many are considering these options as part of their search for more budget-friendly housing solutions.

People Are Spending Less on Newly Built Homes

The graph below uses the latest information from the Census to show, in June, more of the newly built home sales in this country were in lower price ranges than in 2022:

In the previous year, only 58% of newly constructed homes sold for less than $500,000. However, in June of this year, that percentage increased to 65%. This indicates that a growing number of individuals are purchasing more affordable newly built homes at present, even as affordability remains a concern in the housing market.

Builders Are Offering Lower-Cost Options

Builders have picked up on this trend and are reacting accordingly. George Ratiu, Chief Economist at Keeping Current Matters, explains:

“Builders are also responding to this shift by bringing slightly smaller homes to market in an effort to meet lower price points . . .”

New data from the Census further confirms this pattern – it shows the median sales price of newly built homes has dipped down in recent months (see graph below):And as Mikaela Arroyo, Director of the New Home Trends Institute at John Burns Real Estate Consulting, says, the builders who are most responsive to this trend are forming pathways to homeownership:

 “. . . it is creating opportunities for people to be able to afford an entry-level home in an area. . . . if you get that size down, that automatically will make it a more affordable home. The [builders] that are decreasing [size] the most are probably the ones that try to build more of an affordable product.”

 How an Agent Can Help

Builders focusing on creating smaller and more budget-friendly newly constructed homes offer valuable affordability choices during a crucial period. If you’re planning to purchase a home in the near future, it’s advisable to collaborate with a local real estate agent. They can provide insights into the options within your region, including newly built homes and those currently being constructed. Partnering with an agent can guide you through the process and help you find the best housing solutions for your needs.

Bottom Line

If you’re struggling to discover a home that aligns with your budget and preferences, I encourage you to reach out. Connecting with a knowledgeable real estate expert is essential. They possess up-to-date insights into the current inventory in our locality, encompassing homes in various stages of construction. This ensures you have a seasoned professional assisting you, offering details about builder reputations, contractual matters, negotiation strategies, and other vital aspects of the homebuying journey. Their expertise will prove invaluable as you navigate the process of finding and purchasing your ideal home.