Price Gap Between New and Existing Homes Shrinks in Q1 2025

Budget-concious homebuyers may have more options to choose from as the average price gap between new and existing homes narrows. According to the National Association of Home Builders’ Eye On Housing blog, the median price of a new home was just $14,600 higher than that of an existing home in Q1 2025. While the median price for a new home during this period was $416,900, the price for an existing home was $402,300. This difference is unusually small compared with price gaps seen in previous years. For instance, in Q4 2022, the difference in price between new and existing homes reached $64,200, with new homes being more affordable.

This shift can be attributed to the fact that new-home prices have fallen for eight straight quarters, with a 2.32% drop from Q1 2024 to Q1 2025. Comparatively, existing-home prices have increased for seven consecutive quarters, rising 3.38% over the same period.

Both new and existing homes saw dramatic increases in prices post-pandemic due to higher construction costs and limited supply. While overall home prices remain elevated compared to historical norms, new home prices have moderated due to builder business decisions, but existing home prices continue to increase because of lean supply. Read more