By Mary Prenon
Newly built homes across America are scarce in urban areas and carry a significant price premium, according to a new report.
In its May 7 New Construction Insights Report, Realtor.com indicated that only 10.9 percent of new residential construction listings are located in urban areas, and potential buyers may pay 78.4 percent more for these properties than for existing homes.
Nationwide, the median listing price for new urban homes is $738,662, compared with $414,000 for existing homes. For all new construction in both urban and suburban regions, the median listing price held at $449,373 in the first quarter.
“New construction is overwhelmingly a suburban story in the United States, and that has real consequences for buyers who want to live in cities,” Realtor.com senior economist Joel Berner said in the report.
“Urban new builds are difficult to deliver, and that difficulty is priced in. When a new home does come to market in an urban zip code, it commands a price that reflects just how hard it was to build there.”
According to a May land market report from the National Association of Realtors (NAR), the average land price per acre increased by 1.5 percent in 2025. Land sales also rose by 0.8 percent, faster than the 0.7 percent increase in 2024.
Landsearch data show that the average land price is $18,000 per acre. Depending on the location, prices can vary from $1,000 to $100,000. Land values are also determined by access to utilities, infrastructure, and zoning regulations.
While Realtor.com notes that, nationwide, most new construction is located in suburban rather than urban areas, a few metro areas have most of their new-construction listings in urban ZIP codes.
The Miami metro area accounts for 69.5 percent of new-construction listings, but homebuyers there could pay as much as 305.2 percent more than the national average for existing homes, according to the report. The median listing price in the region stands at $2.578 million.
In the New York City metro area, 69.6 percent of listings are new residential construction, often priced at a 106.8 percent premium over existing homes. The median new-home price there is $1.51 million.
Jonathan Miller, real estate analyst and director of markets at StreetMatrix in Manhattan, said while prices for new construction in urban areas continue to escalate, some developers have expressed concern that potential buyers may ultimately reach their limit.
“They are targeting a specific demographic to buy their product when it’s ready, but if prices are rising quickly, they do worry they might overshoot the market when it becomes time to market,” he told The Epoch Times.
However, from a realtor’s perspective, the Big Apple is still one of the nation’s hottest markets. “While listing inventory is below long-term averages, it is not difficult to show high-end properties these days,” Miller said.
Other metro areas accounting for more than 50 percent of new construction listings include San Francisco and San Diego; New Orleans; and Urban Honolulu. Homebuyers in these areas may spend at least 20 percent more for new homes.
Metro regions with the lowest new-construction premiums include Cape Coral and Pensacola, Florida; Austin; and Boise, Idaho. The Realtor.com report notes that new construction in these areas is often less expensive than existing homes, carrying negative premiums of up to 13.5 percent.
The report also shows that nearly 80 percent of new homes for sale are located in suburban areas, compared with more than 55 percent of existing homes. In the suburbs, new homes tend to be priced just 7 percent higher than existing homes. Much of the nation’s new construction is concentrated in the South, where prices often skew lower.
Realtor.com reported that the new overall construction premium—the gap between what buyers spend on a new home versus on an existing one—is up to 15.1 percent from 14 percent in 2025.
Inventory growth for newly built homes has been steady in the 5 percent to 9 percent range year over year, while existing home inventory growth has slowed. The share of total listings for new construction remained nearly unchanged at 19.3 percent this year, compared with 19.4 percent in 2025.
“Builders are navigating a difficult environment,” Berner said.
“They are facing rising costs for labor and materials while competing for buyers who are already stretched by high mortgage rates and economic uncertainty.”
As a result, he noted that some developers have been more willing to negotiate with buyers through price reductions.
