SAN FRANCISCO, May 6, 2014 – Trulia (NYSE: TRLA), a leading online marketplace for home buyers, sellers, renters, and real estate professionals, today published results from a new consumer survey revealing Americans’ preferences between newly constructed homes and existing homes. Harris Poll conducted the online survey on behalf of Trulia among 2,048 U.S. adults, age 18 and over, between March 28 and April 1, 2014. For the full report and methodology, see here.
Many Want New Homes, But Most Unwilling To Pay 20% Premium
For the same price, 2 in 5 of Americans (41 percent) would strongly or somewhat prefer to buy a newly built home instead of an existing home. Just 21 percent strongly or somewhat prefer an existing home, while the remaining 38 percent have no preference. However, new homes cost more. Trulia calculates that new homes built in 2013 or 2014 are typically priced 20 percent higher than older homes of a similar size and location. Among those who strongly prefer a new home, less than half — only 46 percent – are willing to pay at least 20 percent more to purchase a new home versus a comparable existing home.
Why People Prefer New Homes: Modern Features and Customization
Most people are not keen on handling home improvement projects themselves. Fifty-nine percent of Americans said they would prefer to buy a new home to have modern features, such as bigger closets, a kitchen island, open floor plan, walls pre-wired for flat screen TVs, or radiant floor heating. The second most popular reason is being able to customize the home (56 percent), while the third is to spend less on maintenance and repairs (55 percent). These reasons were even more pronounced among the people who strongly prefer new homes to existing homes.
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Why People Would Prefer New Homes |
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# |
Reason |
Total |
Americans who would strongly prefer a new home |
|
1 |
To have modern features |
59% |
63% |
|
2 |
To be able to customize the home before construction is completed |
56% |
63% |
|
3 |
To spend less on maintenance and repairs |
55% |
58% |
|
4 |
To live in a home that meets modern construction standards |
39% |
49% |
|
5 |
To be the first person to live in the home |
25% |
29% |
|
6 |
To live in a newly developed neighborhood near other new homes |
8% |
11% |
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Note: respondents asked to choose the up to three best reasons from the above list, as well as “other,” “none,” and “not at all sure.” |
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Plenty of New Homes for Sale In Texas and the Carolinas, But Not Elsewhere
Since the housing bubble burst, new homes have been a smaller-than-normal share of the for-sale market. 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. 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.
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Top 5 Housing Markets with the Most Single-Family Construction |
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# |
U.S. Metro |
New single-family units permitted in 2013, per 1,000 existing housing units |
|
1 |
17.2 |
|
|
2 |
15.0 |
|
|
3 |
12.7 |
|
|
4 |
12.7 |
|
|
5 |
11.9 |
|
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Source: Census; Among 100 largest metros |
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Top 5 Housing Markets with the Least Single-Family Construction |
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# |
U.S. Metro |
New single-family units permitted in 2013, per 1,000 existing housing units |
|
1 |
New York, NY-NJ |
0.4 |
|
2 |
0.8 |
|
|
3 |
1.0 |
|
|
4 |
1.1 |
|
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5 |
1.3 |
|
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Source: Census; Among 100 largest metros |
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PRE-APPROVED QUOTES
- “Twice as many people prefer newly built homes to existing homes, but barriers often stand in the way of buying a new home,” said Jed Kolko, Trulia’s Chief Economist. “Most people who say they strongly prefer a new home aren’t willing to pay the premium, and many regions of the country have little single-family construction. Still, as the housing market recovers, new homes will be a growing share of the national market.”
- “Why do more people prefer new homes? The top reasons are modern features and the chance to customize the home,” said Jed Kolko, Trulia’s Chief Economist. “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.”
ABOUT TRULIA, INC.
Trulia (NYSE: TRLA) gives home buyers, sellers and real estate agents all the tools and valuable information they need to be successful in the home search process. Through its innovative mobile and web products, Trulia provides engaged home buyers and sellers essential information about the house, the neighborhood and the process while connecting them with the right agents. For agents, Trulia, together with its Market Leader subsidiary, provides an end-to-end system that enables them to find and serve clients, create lasting relationships and build their business. Founded in 2005, Trulia is headquartered in San Francisco with offices in New York, Denver and Seattle. Trulia and the Trulia marker logo are registered trademarks of Trulia, Inc.
Survey Methodology
This survey was conducted online within the United States by Harris Poll on behalf of Trulia from March 28-April 1, 2014 among 2,048 adults ages 18 and older. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please contact pr@trulia.com.
