We were told that builders were slashing prices to attract buyers… really?

Are builders slashing prices to move inventory?

According to the National Association of Homebuilders, the major builders like Lennar and Toll Brothers are.

“A monthly Zonda survey further shows that 15% of builders lowered prices in August, 65% held prices flat, and 20% raised prices. Most builders are offering mortgage rate buydowns to help buyers get into a new home, with 50% of builders reporting they are willing and able to offer a buydown between the low 4%s and the low 5%s.???

Zonda’s New Home Market Update shows there were 720,627 new homes sold in August on a seasonally adjusted basis, a gain of 1.2% from July and 0.7% from a year ago.”?

You know me… it’s time to test these numbers against our local markets. Today I’m going to look in both MLSPIN (the largest MLS in Massachusetts) and Statewide (the MLS owned and operated by the RI Association of Realtors?).

(INSERT YOUR OWN HOLD MUSIC WHILE I’M ON THE PHONE WITH STATEWIDE MLS SUPPORT)

OK, I will not be using RI data because Statewide offers no way for me to access that data. Awesome.

Back to MLSPIN only, then.

1. What were the total number of new construction homes on the market in August 2024? 398
2. What were the total number of new construction homes on the market in August 2024 with a price change? 8
3. What were the total number of new construction homes with a price drop in August 2024? 5
4. What were the total number of new construction homes with a price increase in August 2024? 1

I’m sure you noticed the discrepancy of 8 with a price change but only 6 with noted changes… and that’s a limitation of the MLS… these other 2 were new construction homes on the market in August that had a price change at some point during the year.

So 6 homes with a price change IN August with 5 down and 1 up.

So 1.51% of new construction homes had a price change with 1.26% having a decrease and 0.25% having a price increase. Our actual data does not match up with the national numbers at all.

Heck, where are homes being (and not being) built?

And the above chart tells you what you need to know considering RI is building the fewest new homes in the country… with Connecticut and Massachusetts close behind at #4 and #6, respectively.

Other key stats:

?? There were 2,940 total new construction single family homes of all statuses out of 49,981 total single family homes for sale or sold in Massachusetts in MLSPIN… or 5.9%.

??746 Units are for sale (25.37% and 1.49% of all sales)

??476 Units are pending (16.19% and 0.95% of all sales)

??1,718 Units have sold (58.44% and 3.43% of all sales)

1 Jonathan Jones, “U.S. Cities Building the Most Homes”, constructioncoverage.com, Construction Coverage, Last Updated October 2, 2024, Accessed October 15, 2024, https://constructioncoverage.com/research/cities-investing-most-in-new-housing