The Impact of Expensive New Homes on Real Estate Trends
Numerology attempts to find reality in various measures of economic and real estate trends. Construction is not a shortcut to the affordability problem, as most of the new homes being built are more expensive and larger than other homes on the market. Developers argue they need to build larger homes to save on expensive land purchases and other construction costs.
Price Discrepancies in New vs. Existing Homes
Looking at the data from a study by Zillow, it becomes evident that new homes come with a significant premium compared to existing homes. In California, for example, the median price for a new home is 22% higher than an existing home, mainly due to the larger square footage of new constructions.
Challenges in Affordable Housing
Despite the need for more affordable housing, the market trends show a clear preference for upscale, expensive new communities. Policy and market challenges make it easier to produce high-end housing, catering to wealthier clients and generating higher profit margins. However, this trend does not address the pressing issue of housing affordability for the majority of homebuyers.
Transition words such as “However,” “Despite,” and “In contrast” can help to smoothly guide the reader through the different sections of the text, providing a logical flow of information.
