Latest news with #OscarWei
New York Post
3 days ago
- Business
- New York Post
Homebuyers can save $200K by building a new house — instead of buying one — in west coast state
With affordability being a top concern for many prospective homebuyers, those worried about a steep price tag might consider investing in a new build. In California, homebuyers could save hundreds of thousands of dollars by building new rather than purchasing an existing property, according to a new LendingTree report. It revealed that, though, on average, new homes cost more than existing ones across the country, a select few states offer new construction that is significantly more affordable than existing properties. In California, newly constructed homes have a median price of $591,116, while existing homes cost $784,798—a difference of $193,682 more, according to LendingTree. 6 With affordability being a top concern for many prospective homebuyers, those worried about a steep price tag might consider investing in a new build. Getty Images 6 In California, newly constructed homes have a median price of $591,116, while existing homes cost $784,798—a difference of $193,682 more, according to LendingTree. Getty Images Using data from the National Association of Home Builders and the U.S. Census Bureau 2023 American Community Survey, LendingTree was able to estimate the household income needed for existing homes. Then, it compared the household income required to buy new homes and existing homes by state. This trend is particularly relevant in today's market, where shifting economic sentiment is beginning to shape buyer behavior. 'Many buyers, first-time buyers, or entry-level buyers, instead of just looking at single-family homes or existing homes, are looking at new homes put out by developers and builders,' Oscar Wei, deputy chief economist at the California Association of Realtors, tells Overall, California's median home price dipped to $899,560 in June, marking a second consecutive monthly decline and falling below $900,000 for the first time in three months, as per the California Association of Realtors June Home Sales report. 6 This trend is particularly relevant in today's market, where shifting economic sentiment is beginning to shape buyer behavior. 'The market is a little bit more balanced because we do have a bit more supply in the last few months,' he explains. 'Buyers are thinking, 'OK, well, now we have a little bit more inventory available.' And even though mortgage rates have come down, we do still have some uncertainty.' But the discrepancy between new- and existing-home values in California is the largest gap in the country, according to LendingTree. The state has struggled to keep up with housing demands for decades due to a combination of factors, including rapid population growth, high construction costs, restrictive zoning regulations, and lengthy permitting processes. 'I almost see two different Californias in terms of development,' Victor Currie, real estate agent at Douglas Elliman Real Estate, tells 'The Central Valley and Inland Empire are growth areas with lots of developable land, so prices are more reasonable, and new-home developers can sometimes offer slightly lower interest rates and other incentives to buyers than standard mortgage numbers. Every morning, the NY POSTcast offers a deep dive into the headlines with the Post's signature mix of politics, business, pop culture, true crime and everything in between. Subscribe here! 'But when people in other parts of the country think of California, they're usually talking about Los Angeles, Orange County, the Bay Area, or San Diego, and there is a limit to how much new development can be done in the large metro areas.' The L.A. County's destructive wildfires also directly contributed to the housing shortage, forcing residents into an already competitive market and driving up rental and purchase prices in unaffected areas. Rebuilding in fire-prone areas is tough because of strict new building codes and regulations—increasing costs and potentially delaying reconstruction efforts. However, the bump in inventory in other parts of the Golden State has balanced the market a bit, urging buyers to consider jumping back in, says Wei. 'There's a little bit more supply from builders and developers. Builders and developers are actually willing to lower their price or provide incentives for buyers,' Wei explains. 6 The L.A. County's destructive wildfires also directly contributed to the housing shortage, forcing residents into an already competitive market and driving up rental and purchase prices in unaffected areas. REUTERS 6 Map of the top 10 US states where new home values are lowest compared to existing home values. LendingTree Across the country, new homes cost a median of $537,791 while existing homes cost $391,210, according to the study. The average price difference is $146,581, with new homes being 37.5% more expensive than existing homes. In Connecticut and Pennsylvania, new homes are more than double the cost of existing ones, according to the study. Specifically, new homes in Connecticut cost 125.9% (or $555,660) more on average than existing homes, with Pennsylvania close at 121.4% (or $361,637). Potential pitfalls with new builds Still, the roadblocks to building new homes keep inventory low. Expensive land, permit delays, local fees, high material costs, and labor shortages have limited new construction and increased the competition for existing homes. 'Now, here's an issue that we might be seeing in the last couple of months, maybe even in the second half of the year. Builders and developers started realizing, 'Wow, OK, it looks like we are seeing more existing homes coming onto the market.' And now existing homes are competing with those newly constructed properties,' says Wei. Start and end your day informed with our newsletters Morning Report and Evening Update: Your source for today's top stories Thanks for signing up! Enter your email address Please provide a valid email address. By clicking above you agree to the Terms of Use and Privacy Policy. Never miss a story. Check out more newsletters That competition, however, isn't necessarily bad news for buyers—especially those looking to break into the market. 'Choosing a new build helps people achieve homeownership because it often helps clear the biggest obstacle most home buyers can't get around: affordability,' Marco Smith, a real estate agent with The Maryland & Delaware Group, tells 'Many builders are offering seller concessions to help cover the buyer's closing costs and, in some cases, will pay down the buyer's rate, making monthly payments more affordable. So, whether you're looking to spend less upfront or spend less per month, builders can typically get that taken care of when you're buying their new homes,' says Smith. 6 That competition, however, isn't necessarily bad news for buyers—especially those looking to break into the market. 'As interest rates are higher than they were a few years ago and prices remain strong, many homebuyers are steering away from older homes that may need high-ticket items replaced in the near future. New construction offers the peace of mind that you won't have a roof or HVAC replacement a few years after moving in. These homes also come with warranties,' he adds. Prospective buyers who are considering a new build have a couple of solid options. California, Vermont, and Delaware are leading the list of states where new-home values are lowest. Households in Vermont can expect to pay a median price of $352,739 for a new home, but would have to come up with $386,757 for an existing property—8.8%, or $34,018, more. Delaware follows with the third-highest discrepancy between new- and existing-home values: $373,666 versus $406,266, an 8%, or $32,600, difference. Virginia, Maryland, and Utah households also pay more for existing homes than new-construction properties.
Yahoo
3 days ago
- Business
- Yahoo
Homebuyers Can Save $200K by Building a New Home Instead of Buying an Existing One in This State
With affordability being a top concern for many prospective homebuyers, those worried about a steep price tag might consider investing in a new build. In California, homebuyers could save hundreds of thousands of dollars by building new rather than purchasing an existing property, according to a new LendingTree report. It revealed that, though, on average, new homes cost more than existing ones across the country, a select few states offer new construction that is significantly more affordable than existing properties. In California, newly constructed homes have a median price of $591,116, while existing homes cost $784,798—a difference of $193,682 more, according to LendingTree. Using data from the National Association of Home Builders and the U.S. Census Bureau 2023 American Community Survey, LendingTree was able to estimate the household income needed for existing homes. Then, it compared the household income required to buy new homes and existing homes by state. This trend is particularly relevant in today's market, where shifting economic sentiment is beginning to shape buyer behavior. 'Many buyers, first-time buyers, or entry-level buyers, instead of just looking at single-family homes or existing homes, are looking at new homes put out by developers and builders,' Oscar Wei, deputy chief economist at the California Association of Realtors, tells Overall, California's median home price dipped to $899,560 in June, marking a second consecutive monthly decline and falling below $900,000 for the first time in three months, as per the California Association of Realtors June Home Sales report. 'The market is a little bit more balanced because we do have a bit more supply in the last few months,' he explains. 'Buyers are thinking, 'OK, well, now we have a little bit more inventory available.' And even though mortgage rates have come down, we do still have some uncertainty.' But the discrepancy between new- and existing-home values in California is the largest gap in the country, according to LendingTree. The state has struggled to keep up with housing demands for decades due to a combination of factors, including rapid population growth, high construction costs, restrictive zoning regulations, and lengthy permitting processes. 'I almost see two different Californias in terms of development,' Victor Currie, real estate agent at Douglas Elliman Real Estate, tells 'The Central Valley and Inland Empire are growth areas with lots of developable land, so prices are more reasonable, and new-home developers can sometimes offer slightly lower interest rates and other incentives to buyers than standard mortgage numbers. 'But when people in other parts of the country think of California, they're usually talking about Los Angeles, Orange County, the Bay Area, or San Diego, and there is a limit to how much new development can be done in the large metro areas.' The L.A. County's destructive wildfires also directly contributed to the housing shortage, forcing residents into an already competitive market and driving up rental and purchase prices in unaffected areas. Rebuilding in fire-prone areas is tough because of strict new building codes and regulations—increasing costs and potentially delaying reconstruction efforts. However, the bump in inventory in other parts of the Golden State has balanced the market a bit, urging buyers to consider jumping back in, says Wei. 'There's a little bit more supply from builders and developers. Builders and developers are actually willing to lower their price or provide incentives for buyers,' Wei explains. Across the country, new homes cost a median of $537,791 while existing homes cost $391,210, according to the study. The average price difference is $146,581, with new homes being 37.5% more expensive than existing homes. In Connecticut and Pennsylvania, new homes are more than double the cost of existing ones, according to the study. Specifically, new homes in Connecticut cost 125.9% (or $555,660) more on average than existing homes, with Pennsylvania close at 121.4% (or $361,637). Potential pitfalls with new builds Still, the roadblocks to building new homes keep inventory low. Expensive land, permit delays, local fees, high material costs, and labor shortages have limited new construction and increased the competition for existing homes. 'Now, here's an issue that we might be seeing in the last couple of months, maybe even in the second half of the year. Builders and developers started realizing, 'Wow, OK, it looks like we are seeing more existing homes coming onto the market.' And now existing homes are competing with those newly constructed properties,' says Wei. That competition, however, isn't necessarily bad news for buyers—especially those looking to break into the market. 'Choosing a new build helps people achieve homeownership because it often helps clear the biggest obstacle most home buyers can't get around: affordability,' Marco Smith, a real estate agent with The Maryland & Delaware Group, tells 'Many builders are offering seller concessions to help cover the buyer's closing costs and, in some cases, will pay down the buyer's rate, making monthly payments more affordable. So, whether you're looking to spend less upfront or spend less per month, builders can typically get that taken care of when you're buying their new homes,' says Smith. 'As interest rates are higher than they were a few years ago and prices remain strong, many homebuyers are steering away from older homes that may need high-ticket items replaced in the near future. New construction offers the peace of mind that you won't have a roof or HVAC replacement a few years after moving in. These homes also come with warranties,' he adds. Prospective buyers who are considering a new build have a couple of solid options. California, Vermont, and Delaware are leading the list of states where new-home values are lowest. Households in Vermont can expect to pay a median price of $352,739 for a new home, but would have to come up with $386,757 for an existing property—8.8%, or $34,018, more. Delaware follows with the third-highest discrepancy between new- and existing-home values: $373,666 versus $406,266, an 8%, or $32,600, difference. Virginia, Maryland, and Utah households also pay more for existing homes than new-construction properties. 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Epoch Times
5 days ago
- Business
- Epoch Times
Only 18 Percent of Californians Can Afford to Buy a Home
In California, the housing market appears stable, but the income needed to afford a typical home is well over $200,000 a year. Most households make less than half that. Only 18 percent of Californians can afford to purchase a median-priced home. In this episode, economist Oscar Wei explains how interest rates, limited supply, an...
Newsweek
10-07-2025
- Business
- Newsweek
California's Housing Market Freezes Up
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Home sales have plummeted in California over the past few years and are now down 37 percent from their pandemic peak, according to data from real estate analytics platform Reventure App. Real estate analyst Nick Gerli, Reventure's CEO and founder, said that this plunge in sales indicates "a massive homebuyer strike underway in California right now" which is likely the result of how expensive the Golden State market has gotten over the past five years. Falling Sales and Rising Inventory While the California housing market remains competitive—with homes for sale spending an average 31 days on the market before going under contract, less than the nationwide median of 38—and home prices are still rising, buyers in the state are clearly withdrawing. According to the latest Redfin data, home sales in California totaled 24,895 in May, down 7.9 percent from a year earlier. An analysis of historical data by Reventure found that this number was about 25 percent lower than the state's long-term average—the typical or expected number of sales over an extended period of time. It was also significantly lower than the pandemic peak reached in June 2021, when the Golden State closed 43,471 sales. According to the California Association of Realtors, it was actually the biggest yearly decline in sales in 17 months. A Compass Realty sign is posted in front of a home for sale on June 23, 2025, in Greenbrae, California. A Compass Realty sign is posted in front of a home for sale on June 23, 2025, in Greenbrae, drop in sales might have something to do with the fact that the median sale price of a home in California remains much higher than that of a typical home in the U.S. In May, the median sale price of a home in the state was $859,700, up 0.02 percent year-over-year; in the U.S., it was $440,910, up 0.6 percent from a year earlier. Not only are homes expensive, but mortgage rates remain high—as of July 3, the average 30-year fixed-rate mortgage was 6.67 percent—and other costs—including home insurance, homeowners association (HOA) fees and repairs—are also going up, making buyers think twice about whether they can afford owning a home. "Buyers are waiting for the costs of homeownership to come down. That could mean lower mortgage rates or lower home prices," Oscar Wei, deputy chief economist at the California Association of REALTORS® (CAR), told Newsweek. "Buyers could also be waiting for some clarity on the market direction, as consumers remain concerned about how tariffs and the ongoing trade tensions could affect the economy and their personal finances." What Gerli describes as a "homebuyer strike" is starting to push up inventory in the state, where the supply of available homes is low and has been kept down by California's strict red-tape policies. According to Redfin, there were 112,485 homes for sale in the Golden State in May, up 18.7 percent from a year earlier. Of these, 38,160 were newly listed homes. According to data, active listings in the state totaled 76,737 in June. "This is the second-highest inventory level for June going back almost 10 years. So inventory is now rising, which is putting downward pressure on prices," Gerli told Newsweek. "The question is: will inventory continue to rise? If it does, I think the potential is there for California to experience a 15 percent housing correction." On the state level, only 40.4 percent of homes sold above list price in May, 9.53 percentage points less than a year earlier. On the other hand, 28.6 percent of home listings had price drops, up 4.4 percentage points from May 2024. "The increase in supply could alleviate some upward pressure on prices and make homeownership easier for those who are considering buying now," Wei said. A Market To Keep an Eye On While prices are not rising as much as they have in the past few years, they are far from dropping at the state level in California. According to Gerli, the state's housing market "will likely continue to struggle until affordability improves." Currently, he said, the median household in the state needs to spend over 62 percent of their gross income to afford mortgage and tax payments on a home purchase—which is an untenable proposition for many. "That's the most expensive of any conventional U.S. state, and ultimately, a payment ratio that puts owning a home out of reach for the vast majority of California renter households," Gerli said. But the dynamics unfolding in California should be watched closely, Gerli said, as any downturn in the state could have "big implications for the U.S. market more broadly," especially if California's housing market heads toward anything like a recession. The performance of the state's housing market has historically had a direct impact on California's neighbors—including Idaho, Utah, Arizona, Nevada and Washington—where Californians have sought cheaper housing when their own state offered little options. "California's high housing costs result in some would-be buyers electing to move to more affordable nearby states like Arizona, Nevada, and Idaho to buy a house," Gerli told Newsweek. "As a result, if home values were to drop in California, it could mean fewer people electing to leave the state—and less homebuyer demand in the surrounding states."
