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Stagnation in the Housing Market: What the Latest Data Reveals

The real estate landscape is experiencing significant challenges, as evidenced by Zonda's latest update for June 2025. The data uncovers a troubling picture of the new home market's stagnation, with resale activities sluggish and new home sales noticeably dropping compared to the previous year. The trend raises concerns not just for potential homeowners but also for the broader economic environment, given the housing sector's pivotal role in job creation during construction, at sale points, and post-move-ins.

Key Insights from the Zonda Report

According to chief economist Ali Wolf of Zonda and NewHomeSource, the prolonged stagnation in sales could yield a wider economic impact, especially relating to a reduced pace of housing starts. The numbers illustrate a mixed bag:

• - The seasonally adjusted annualized rate saw 689,834 homes sold in June, indicating a minor increase of 1.5% from the previous month but a decrease of 2.2% compared to last year.
• - Non-seasonally adjusted figures revealed 58,848 homes sold, down 1.5% from last year, although showing a 5.3% increase from the same month in 2019.

Interestingly, the Zonda Market Ranking (ZMR) has held steady at an average of 107.4 for the sixth consecutive month. Though the market isn't witnessing explosive growth, consumer responses to builder incentives and price reductions hint at potential for improvement.

Challenges for Home Pricing

A significant factor contributing to stagnation is the pricing landscape for new homes.

• - The average price of entry-level homes has dipped by 1.7% to approximately $326,964.
• - The move-up segment saw a slight decrease of 1.0%, bringing the average to $518,725.
• - Conversely, the high-end market has remained stable, tethered at an average of $915,696.

Zonda’s monthly survey highlighted that 39% of builders slashed prices in June compared to 38% in May. Meanwhile, 59% maintained their prices, and a mere 2% increased them.

Community Counts: A Slight Upsurge

Despite the overall challenges, there has been a positive trend in community counts, with active selling communities increasing for the seventh month in a row. The current figure stands at 16,400, reflecting an 8.9% year-over-year growth. Month-over-month, the figure also demonstrates a minor rise of 0.4%. However, it remains down 15.1% when compared to the same month in 2019.

The year's standout performers include cities like Orlando, Raleigh, and Charlotte, registering growth rates of 17.1%, 12.7%, and 11.4%, respectively. In contrast, Philadelphia, Minneapolis, and New York are witnessing declines in this metric, marking decreases of 16.2%, 11.4%, and 10.0%.

Rise in Quick Move-Ins

In a somewhat positive twist, the number of quick move-ins—properties likely available for occupation within 90 days—rose to 38,195, reflecting an 18.5% increase compared to the same month last year, albeit a slight decrease of 0.9% from the previous month. This total is notably 81.2% higher than the two years ago, indicating a recovery in quick move-in options.

Cities such as Seattle, New York, and Salt Lake City reported remarkable growth in quick move-ins, achieving increases of 184.2%, 141.5%, and 95.7%, respectively. Additionally, Jacksonville, Las Vegas, and Riverside/San Bernardino experienced substantial annual growth percentages from 2019, standing at 237.7%, 231.9%, and 222.5%.

Overall, while the new home market struggles under various pressures, shifts in community activities and pricing indicate that there may be light at the end of the tunnel. For more detailed insights and ongoing trends in housing, NewHomeSource.com/news offers a wealth of resources. Zonda continues to lead the analysis of the production new home market across the United States, maintaining track of about 85% of this vital sector.

Zonda's commitment to enhancing the home building industry reflects a belief that improved housing leads to not only better lives but stronger communities. As the market grapples with its current challenges, this unwavering focus underscores the importance of resilience in the face of economic hurdles.