New Home Inventory Reaches Four-Year Low as Builders Refrain from Starting New Projects

The rise in existing home listings and a decrease in new home sales have led to a surge in the pool of new home inventory, causing some builders to halt new projects. According to a recent report from Redfin, newly built homes made up 26.8% of single-family homes for sale nationwide in August, the lowest level in four years. This decline is attributed to a rebound in existing home listings, which have increased as homeowners, locked in by ultra-low mortgage rates, begin to list their homes.

Key Takeaways:

• Newly built homes made up 26.8% of single-family homes for sale nationwide in August, the lowest level in four years.
• The share of new homes as a percentage of single-family supply has decreased from 35% in 2022 to 26.8% in August 2025.
• Existing home listings have rebounded, with more Americans listing their homes due to the easing of the lock-in effect, life circumstances, and slightly lower mortgage rates.
• Homes are selling in a median of 50 days, the longest September span since 2016.
• Some homebuilders are refraining from starting new projects as they try to offload inventory that's already completed.
• Builders are offering incentives such as mortgage-rate buydowns, paying for closing costs, and new appliances to attract buyers.
• Roze Swartz, a Redfin Premier agent in Houston, noted that builders are desperate to sell, with prices lower than usual, insurance costs lower than for existing homes, and buyers having the power due to more supply than demand.
• Jesse Landin, a Redfin Premier agent in San Antonio, stated that builders are hesitant to start new projects due to the oversaturated market, leading to some local builders laying off workers.

Statistics:

• 26.8%: The percent of newly built homes as a share of single-family homes for sale nationwide in August 2025.
• 35%: The percent of newly built homes as a share of single-family supply in 2022.
• 28.2%: The percent of newly built homes as a share of single-family homes for sale nationwide in August 2024.
• 30.6%: The percent of newly built homes as a share of single-family homes for sale nationwide in August 2023.
• 4% or 5%: The potential mortgage rate offered by builders to attract buyers.
• $10,000: The amount offered by builders in closing costs.
• 50 days: The median time it takes for homes to sell in September.
• 6%: The decline in housing starts year-over-year in August.
• 8.4%: The decline in housing completions year-over-year in August.

Sources:

• Redfin, "August 2025 New Construction Homes" report
• U.S. Census, housing starts and completions data
• Businesswire.com, "Redfin Reports 26.8% of Single-Family Homes for Sale in August Were New Construction" article
• RocketCompanies.com, company information
• Redfin.com/news, housing market data and research