Builders Respond to Affordability Challenges with Buyer Incentives and Innovative Designs

During New Homes Month in April, the home building industry is responding to market conditions by constructing homes that balance price and meet modern home buyer needs. According to U.S. Census Bureau and National Association of Realtors data, newly built homes are typically priced at or below existing homes, offering buyers more options in today's challenging housing market.

"Homeownership remains a cherished ideal for families across the country, and builders are stepping up to make homes attainable," said NAHB Chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. "We will continue working with policymakers at every level of government to address supply-side challenges and seek regulatory relief that affects housing affordability."

In 2025, a typical existing home sold for 1% more than a newly built home. Since 2022, median new home prices have declined by 5%. Builders are narrowing the price gap by adjusting costs and design. According to a recent NAHB survey, 64% of builders offered sales incentives and 37% cut prices. In addition, the median home size in 2025 was 2,155 square feet, essentially unchanged from 2024. Smaller homes generally improve affordability for buyers.

Looking ahead, builders are increasingly expanding usable living space with patios, front porches and decks, complemented by exterior lighting and landscaping. Builders are also adapting to buyers' preferences for flexible interiors and modern features, including:

• Adding drop zones (for keys and coats) (57%)
• Including flex/multipurpose rooms (50%)
• Adding a charging station for EVs (40%)

As single-family home inventory remains low and attainability challenges persist, new construction is playing an increasingly pivotal role in expanding housing options for buyers. New single-family home inventory in January rose to 476,000 units, 0.4% higher than the previous month. This represents a 9.7 months' supply at the current building pace.