While a solid number of Americans would prefer to buy a new home over an existing home, this goal remains a struggle as new home inventory remains low, according to the results of a Trulia survey.
With all prices being equal, the survey shows that two in five (41%) would strongly or somewhat prefer to buy a newly built home instead of an existing home. Just 21% strongly or somewhat prefer an existing home, while the remaining 38% have no preference.
Trulia calculates that new homes built in 2013 or 2014 are typically priced 20% higher than older homes of a similar size and location. Among those who strongly prefer a new home, fewer than half – only 46% – are willing to pay at least 20% more to purchase a new home versus a comparable existing home.
The survey says the No. 1 reason people prefer a new home is it has modern features (e.g., bigger closets, a kitchen island, an open floor plan). The second most popular reason is being able to customize the home themselves, while the third is to spend less on maintenance and repairs.
Today, buyers looking for new homes will have the most luck in Texas, North Carolina and South Carolina, where single-family home construction is highest after adjusting for market size, based on Census permit data, according to Trulia.
Comparatively, the rate of single-family home construction is lowest in New York and San Francisco, where there is less new construction overall and where the vast majority of new construction is in multi-unit buildings, not single-family homes.
Jed Kolko, Trulia's chief economist, believes that "new homes will be a growing share of the national market" as the housing recovery continues. "Fewer people prefer existing homes, but those who do point to traditional features and living in a more established neighborhood. For many people, the best of all worlds might be a newly built home in an older neighborhood."
Trulia's survey was conducted online between March 28 and April 1 among 2,048 U.S. adults ages 18 and older. The entire report can be found here.