It feels a little absurd to say newly built homes are cheaper than existing homes, which have been lived in for years, but it’s true. Per square foot, new homes sold for $3.50 less than existing homes in May. It might not sound like much to you, but it is the largest discount in at least six years, according to Zillow.
If you’re looking at two homes that are 2,000 square feet, the difference between the two would be $7,000. You’d be paying more for an older home that’s been lived in and might even need remodeling. Before the pandemic, newly constructed homes “commanded a serious premium,” according to Zillow, between $15 and $22 more per square foot than existing homes. So for two homes that are 2,000 square feet, the difference was at least $30,000—the premium for a completely new home, unused and likely modern.
