SmartMoney Blogs

Real-Time Advice
Our real-time advice on how market shifts and news impact you and your money

Price Gap Narrows Between New, Old Homes


New homes tend to be pricier than existing ones, but the gap between the two is beginning to shrink.

In June, the median sale price of an existing home was 24% less than the latest price for a new home, according to data released Thursday by the National Association of Realtors. A year ago that gap was 37%. The median existing home price was$189,400 last month, versus $234,500 for a new home in May, the most recent data available.

The difference in prices between the two had steadily widened over the past two years. In fact, since 2006 the price gap more than tripled.

So why the turnaround? Lower inventory is helping to push up prices of older homes, says Lawrence Yun, chief economist with the National Association of Realtors. Plus, foreclosures and short sales — which dampen selling prices — are falling: they made up 25% of sales last month, down from 30% of sales in June 2011, he says.

But despite lower inventory for existing homes, the supply of new homes is still playing catch-up, studies show. There was a 6.6-month supply of existing homes in June, Yun says, versus a 4.7-month supply of new ones, according to the latest government figures. That’s still bad news for the buyers of new homes, experts say. A supply of six months represents a market in balance; above that is good for home buyers, below that is better for sellers, says Jed Kolko, chief economist at real estate listing site Trulia.

Still, the market for new homes recently showed signs of a turnaround. On Wednesday, the Commerce Department reported that U.S. home building rose 24% in June to the highest level in nearly four years. The growth in construction for new – and more expensive – homes shows that the market is finally reaching a turning point, experts say. “We’re pretty close to a bottom, so for those that can afford to it’s a great time to buy,” says Daren Blomquist, vice-president at market researcher RealtyTrac.

There are other reasons new homes tend to be more expensive. For one, the median new home is 2,300 square feet — 25% larger than the median existing one. There’s also less maintenance on new homes, experts say. Superior building materials add to the price tag in the short-term but make the new homes cheaper in the long run, says Stephen Melman, director of economic services at the National Association of Home Builders.


We welcome thoughtful comments from readers. Please comply with our guidelines. Our blogs do not require the use of your real name.

Comments (5 of 6)

View all Comments »
    • By WebOsPublisher

      FocalAdvice – I am using WINDOWS VISTA, and all of a sudden my Sound & Network Icons dissappeared from the notification area?
      Login Bookmark:Subscribe:
      FocalAdvice – Get Free Advice
      Ask A Question
      Answer Questions
      Top Experts
      Contact Us
      About Us
      Alternate Energy Sources
      Arts & Humanities
      Autos & Transportation
      Baby & Pregnancy
      Beauty & Style
      Bridal & Weddings
      Computer & Electronics
      Construction & Building Tools
      Current Events
      Entertainment & Music
      Finance & Investing
      Food & Drink
      For Fun
      Games & Hobbies
      Health & Fitness
      Holiday and Seasonal
      Home & Garden
      Jobs & Careers
      Military & Veteran
      Other & Miscellaneous
      Politics & Government
      Real Estate
      Relationships & Family
      Science & Math
      Social Sciences
      Sports & Recreation
      Did You Know?
      FocalAdvice helps thousands of people get fast answers to the questions the have.
      Get free advice on a variety of topics.
      You are here: Home » Software » I am using WINDOWS VISTA, and all of a sudden my Sound & Network Icons dissappeared from the notification area?
      I am using WINDOWS VISTA, and all of a sudden my Sound & Network Icons dissappeared from the notification area?
      I am using WINDOWS VISTA, and all of a sudden my Sound & Network Icons dissappeared from the notification area? I have tried to go on Properties > Notifications area, but the boxes for sound and internet are shaded and cannot be checked.I have also tried customize notification icons, but the sound and internet iconds are not there.some people have said: "Go to Sounds and Audio Devices in Control Panel and check Place Volume Icon in the Task Bar". but when i go to my control panel, there is no ‘sounds and audio devices’, only hardware and sound or something…thank you so much if you can help me, this is a major problem.I have also deleted the ‘IconStreams’ & ‘PastIconsStream’ things from my comp. but i dunno what do do next..My computer is totally new, and I hope it’s not a virus, if so, how do i find it and delete it?
      Submitted: 1522 days ago
      Submitted: 1522 days ago
      In windows Vista, and Windows XP, you should see a little speaker Icon by the System Tray, if you dont, go to audio and devices in windows vista, please please please put a check where it says "show sound icon in system Tray"and the little icons should Appear there, I had no problems with Windows Xp. but for vista, I dont your sound driver working ok??try to test if the sound is working, put a cd or music in windows media player 11see if the sound is working, if its not, then thats a sign, and thats probably why you dont see the Little speaker icon by the clock.good luck, hope you fix it soon
      RaffiTheMa ster
      Related Questions
      1. Help me the best positions place speakers for the best sound
      Entertainment & Music
      547 days ago
      2. system icons of the notification area on windows taskbar?
      1257 days ago
      3. notification area problems, windows icons don’t show up…?
      1506 days ago
      4. How do you permanently delete notification icons from the notification area of the taskbar?
      1560 days ago
      5. In windows vista home premium, in the notification area?
      1309 days ago
      6. Notification Area(not the system tray) Icon Removal on Windows Vista?
      Other – Computers
      1494 days ago
      FocalAdvice provides free advice to millions of users within dozens of topics. Our user comunity of experts provides reliable answers to your questions. Use our search engine to find answers already posted, or ask a new question if you prefer.
      Featured Questions:
      Why should Jackson Pollock’s style of painting, be exempli…
      A large sport utility vehicle has a mass of 2600 kg.
      Statistics for Psychology
      A large sport utility vehicle has a mass of 2600 kg. Calcu…
      Charging camcorder battery
      Ask a Question
      Contact Us
      About Us
      Site Map
      Copyright © 2012 All Rights Reserved
      Terms $ Conditions | Privacy | Contact

    • g;k/h

    • Develop Anything But Not Residential – YET

      As the founder of The REDI Foundation, the World’s leading educational and research institute in the field of real estate development, I try to balance my enthusiasm with reality.

      Housing is the wrong real estate development product for developers and builders STILL.

      Great development opportunities exist in mixed use urban projects, apartment development, and even certain specialty retail developments.

      Our Course teaches the “value generator” method of identifying these developments in demand in a scientific manner.

      Our top student in the current Course, an Architect with no real estate development experience, after just 6 months in the Course, will be developing and joint venturing a $36,000,000 San Diego Apartment project.

      So, if you’re a developer or “emerging” developer, it’s not the right time to develop residential but other fabulous development opportunities are ripe if you know how to identify them.

      Don’t be influenced by the spin masters pushing residential development – YET. Stay tuned.


      Richard Michael Abraham
      The REDI

    • You’re right, Cole. Months supply is how long it would take to sell the current inventory of homes. So a number lower than 6 months is better for sellers; higher for buyers. New homes are selling at a brisker pace than existing ones because builders pulled back on building during the recession. The favorable June Commerce Department numbers for new homes is evidence of that.

    • It says that is bad news for sellers of new homes, yet then you go on to say that anything under 6 months supply is good for sellers and new homes are at 4.7 months supply.

About Real-Time Advice

  • How breaking news — in the markets, Washington, and around the world — affects you and your money. Have a question about how current events may change your financial future? Email us at