Everyone knows that newly built single-family homes have become quite pricey, but the exact numbers are still eye-opening.
We’re no strangers to the rising costs of new homes, here at Chicago Agent. Every month the past few years, we’ve been chronicling the steady rise in newly built single-family homes with each new report from the Census Bureau; just the other week, in fact, we reported that the median sales price for new homes was up 4.9 percent year-over-year in July to $269,800.
Still, even in the reporting of those incremental changes, the long-term trends can still astound, and the price of new homes is a classic example. Consider these stats, pulled from Census Bureau data:
- From 2004 to 2014’s second quarter, the median price of a new home rose from $212,700 to $277,200, an eye-opening increase of 30 percent. That’s ahead of the rate of inflation and far ahead of wage growth.
- Regionally, price increases tell an interesting tale about the housing recovery: in the Northeast, median price is up 24 percent; in the Midwest, it’s up 26 percent; in the South, it’s up 45 percent; and in the West, it’s up 19 percent.
- What’s the cause for such an increase? As we’re reported a number of times in the past, both the price and size of newly built homes have risen to all-time highs in the last couple of years for a very specific reason – simply, wealthier consumers are the prevailing customers nowadays for new homes, and builders have responded accordingly by building homes geared toward that clientele.
Check out our graph below to get a better idea of how new home prices have risen in the last 10 years: