Monday, January 30, 2023 / by Nick Waldner
Understanding the impact new construction has on your home’s value.
How does building new-construction homes impact the value of existing homes? To understand this, we first need to understand how many homes are built each year. That number is about one million homes per year across the United States. During 2005 and 2006, we saw a significant increase in that number, and following the crash of 2008 until about 2019, the number decreased. This occurred while the population continued to increase, and we saw households growing in size.
In recent years, we’ve seen an uptick in the number of homes being constructed, but not enough to offset the years of missing homes. We still have that deficit in our inventory. If you add up all the years of limited construction, that deficit is about 2.5 million homes.
Supply always affects demand. Therefore, these inventory levels affect home prices. If you have any questions about the value of your home, we can help. Reach out and we can use a market analysis to see how your home compares to new and resale homes in your area. Call or email anytime.