“New construction has been one of the steadiest parts of the housing market over the past few years, but builders are clearly responding to today’s affordability pressures and higher levels of existing-home inventory,” Realtor.com chief economist Danielle Hale said in a statement.
But for those who are financially prepared to buy a home, discounts on new construction may be welcome news.
“What we’re seeing is a market where single-family new construction is filling an affordability gap that resale homes increasingly can’t,” Realtor.com senior economist Joel Berner said in a statement.
At the time, Devyn Bachman, senior vice president of research with John Burns Research and Consulting, said these incentives were the “number one” driver for rising new-home sales figures.
“‘Incentive’ is just a big fancy word for discount, and what we’re seeing on that front is that it’s what’s creating a competitive advantage for the new-home market,” she told Fortune in 2023. The mortgage rate buydown, the industry term for discounted mortgage rates, is the most “desired and most effective” incentive offered in the new-home market today, she added.
But now, new-home builders are forced to offer straight-up discounts to stay competitive and entice homebuyers.
While discounts are becoming relatively common (one in five new homes was discounted in Q4 2025), they’re not evenly spread across the country.
Price reductions are generally concentrated in the South and West, according to Realtor.com, where much of the nation’s new construction has been clustered in recent years. The states that had an overall share of price-reduced, new-home listings exceeding the national average are relatively nationwide, though: They were Nevada (nearly 25%), Indiana (23.3%), South Carolina (21.6%), Minnesota (21.6%), North Carolina (21.3%), New Jersey (nearly 20%), and Texas (19%).
Meanwhile, “new builds in the Northeast and Midwest are much more of a luxury product and much harder to come by,” so they aren’t discounted with the same level of frequency, according to Realtor.com.
An exception to the trend in new-construction homes facing price drops is with condos and townhomes. During Q4 2025, the median listing price for newly built condos and townhomes was actually higher than for new-build single-family homes.
Nearly 10% of all new condos for sale in the U.S. are in New York City or Miami, where median listing prices top $1 million. Meanwhile, new single-family construction is concentrated in more affordable markets like Houston, Dallas, San Antonio, Atlanta, and Phoenix, where prices are closer to the national median.
“More new condos may be targeting luxury buyers, while many new single-family homes are designed for the entry-level buyer,” the Realtor.com report explained. “It could also be the case that existing single-family homes hold their value better than attached homes.”
