New Homes In DC Area Are Selling for 8% Less Per Square Foot Than Existing Homes, Per Report

• September 29th

by UrbanTurf Staff

✉️ Want to forward this article? Click here.

New construction homes are selling for less per square foot than existing homes in the DC area market, according to a new analysis from Zillow, reversing a trend that has historically seen buyers pay a premium for new construction. Newly built homes in the D.C. market sold for a median $268 per square foot in July, compared with $290 per square foot for existing homes—a difference of about 8%.

To be clear, this doesn't necessarily mean that a comparable newly built home is cheaper than a comparable resale. Zillow's figures compare the median price per square foot across two different pools of homes, which can vary significantly in size, location, type, finishes, and other characteristics. Still, the gap is notable because new construction has traditionally carried a price-per-square-foot premium over existing homes.

The trend is also occurring against a relatively limited supply of new construction in the regional market. New homes accounted for 8.7% of area home sales over the 12 months ending in July, down from 13.5% in 2019. Nationally, builders have been contending with a larger supply of unsold homes and have increasingly used price cuts and incentives, including mortgage-rate buydowns, to attract buyers.

The DC area numbers are part of a broader shift. Nationwide, newly built homes have sold for less per square foot than existing homes in 17 of the past 19 months, according to Zillow. Between 2018 and 2024, by comparison, new homes carried a per-square-foot premium in 77 of 84 months. Zillow points to elevated new-home inventory as one reason for the change, with the national supply of new homes reaching 9.6 months in July, up from 7.6 months two years earlier.

This article originally published at https://dc.urbanturf.com/articles/blog/new_homes_in_dc_area_are_selling_for_8_less_per_square_foot_than_existing_h/25047.