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Housing market: What the prices of new vs. existing homes tells us

January 03, 2025 / 01:00

This episode discusses the current state of the housing market, focusing on new home prices, affordability, and construction challenges. Key topics include the comparison of new homes to existing homes, the decrease in home sizes, and the impact of land availability and skilled labor costs on construction.

The conversation highlights that new homes are not priced higher than existing homes for the first time, indicating construction firms are attempting to build more affordable options. However, despite these efforts, affordability remains a significant issue.

Listeners learn that the size of new homes has decreased by 6% over the last three years, yet the overall affordability is at a 40-year low. This situation presents challenges for younger generations trying to enter the housing market.

TLDR

New home prices are not higher than existing homes, but affordability remains a major issue for young buyers.

Episode

1:00
00:00:00
for the first time interestingly the price of a new home is not at a premium to existing homes which tells us that
00:00:08
the construction firms are building to the market they're trying to build more
00:00:12
affordable homes they've decreased the size of the homes in the last three years by 6% but there are limits to how
00:00:20
much they can get the cost down and one of the major limits is land and whether it's available to build which increases
00:00:29
the availability sites also skilled labor which is increasingly even over the last 5 years more expensive the
00:00:38
price of new homes even with this attempt to make them more affordable is not affordable we are at 40-year low in
00:00:46
measures of affordability which is why the Young Generation are having such a difficulty in becoming homeowners

Episode Highlights

  • Housing Affordability Crisis
    The price of new homes is not at a premium to existing homes, indicating a shift in the market.
    “We are at a 40-year low in measures of affordability.”
    @ 00m 46s
    January 03, 2025

Episode Quotes

  • The Young Generation are having such a difficulty in becoming homeowners.
    Housing market: What the prices of new vs. existing homes tells us

Key Moments

  • Market Shift00:02
  • Affordable Homes00:12
  • Young Generation Struggles00:51