That question keeps boiling up to the surface, as buyers grapple with the current state of the housing market. High prices and soaring mortgage rates are driving affordability into the dirt. And lurking at the center of all buyer challenges is one towering and inescapable bugaboo: the lack of available homes. It’s simple math. Fewer homes = increased competition, higher prices, and epic levels of frustration.
Last year, new-home construction permits for single-family dwellings declined by about 14% over the previous year—and it’s hardly a new trend. Since the 1990s, U.S. housing starts per 1,000 households have been about half of what they were for the preceding 30 years. The building slowdown spiked in the wake of the 2008 housing crash, then again with the supply-side issues of the COVID-19 pandemic. The current shortfall in new construction is estimated to be as high as 6 million homes.
But not all corners of the U.S. are quite as new-home parched as others. There are still places where builders are putting up new homes to meet buyers’ demands, especially in more affordable areas where dollars stretch further. And Realtor.com® searched out those metros.
Most of these places are in the South, where land is more readily available, expensive building regulations are fewer, and prices aren’t as crazy as they are in states like California.
And among the locations on this list are several pandemic hot spots, including Austin, TX and Boise, ID, which has seen a flood of new residents in recent years.
“Builders are simply following where more Americans are moving,” says George Ratiu, a senior economist and manager of economic research at Realtor.com. “These are fast-growing cities, with a lot of lifestyle amenities and a lot of young people and professionals moving in. Builders have recognized this and are trying to catch up to this incredible growth.”
It’s true that new homes are generally more expensive. In January, the median price tag on a new home was $427,500, according to the most recent data from the U.S. Census Bureau and U.S. Department of Housing and Urban Development. That was about 19% more than the list price of an existing home, which was $359,000, according to the National Association of Realtors®.
But the advantages of buying a newly built house are far more significant than you might think. The bigger builders are often more willing to cut prices below what a typical homeowner can stomach when negotiating with a buyer. Builders can also sometimes get more creative with financing, including mortgage rate buy-downs that can save buyers big bucks as an incentive.
Another benefit? New-home buyers get to select the cabinets, counters, paint, and other finishes on the front end. Who wouldn’t want to sidestep the tedious renovations that often come with an existing-home purchase?
To come up with this list, Realtor.com dug into the Census Bureau’s 2022 new-home construction permit data, as permits are a strong indication of future new construction. We identified the metro areas with the most new single-family home construction permits per capita, to arrive at the places with the most new homes slated to be built—relative to the local population. (This ensures the largest metros, such as New York City, don’t dominate the ranking.)
We limited our list to just one metro per state to establish geographic diversity. Metros include the main city and surrounding towns, suburbs, and smaller urban areas.
So where are America’s new home-building boomtowns? Here’s what we found.
1. Myrtle Beach, SC
Myrtle Beach, SC
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Single-Family New-Home Construction Permits in 2022: 11,550
Median Single-Family Home List Price*: $410,000
Myrtle Beach has long been a tourist and retiree destination known for its sandy beaches, famous golf courses, and relatively affordable home prices. In recent years, the town’s economy has expanded, especially in the areas of manufacturing, healthcare, and technology.
“It’s a coastal port, and its economy has been diversifying beyond just tourism,” says Ratiu of Myrtle Beach.
The city also has a lower cost of living than many other coastal cities that home shoppers might consider. That has helped make it an attractive option for retirees. The city came in fourth in Realtor.com’s ranking of the most affordable places to retire.
The area has also benefitted from the rise in remote work, according to John Hunt, of MarketNsight.
“Builders are going there, because people can live anywhere now,” Hunt says. “You’re seeing this activity in these towns that are close to the water.”
For a little more than $400,000, buyers can find a new five-bedroom home near the Pine Lakes Country Club, in the center of Myrtle Beach.
2. Ocala, FL
Ocala, FL
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Single-Family New-Home Construction Permits in 2022: 5,318
Median Single-Family Home List Price: $309,950
Around the center of Florida, halfway between the Atlantic Ocean and the Gulf of Mexico, Ocala has a booming, new-home construction market.
“Ocala used to be a sleepy little community, mostly centered around horse farms and horse riding,” Ratiu says of the area. “And because of the rising costs throughout the rest of Florida, like in Orlando and Miami, it’s become a [homebuying] destination for a lot of people—and not just retirees.”
With 370,000 residents, Ocala is the smallest metro on the list of areas with the most new-home construction. It’s also one of the least expensive places on the list. Per square foot, homes in Ocala are about 9% less expensive than the U.S. average.
Home shoppers here can find a new four-bedroom home—on a half-acre lot and with a two-car garage—for just over $300,000.
3. Salisbury, MD
A home for sale on the outskirts of Salisbury, MD
Realtor.com
Single-Family New-Home Construction Permits in 2022: 4,271
Median Single-Family Home List Price: $508,495
In the center of the lazily-named DelMarVa Peninsula (dubbed this because it spans property in Delaware, Maryland, and Virginia), you’ll find Salisbury. It’s the largest city (by population) on Maryland’s Eastern Shore portion of the peninsula, and it’s another place where aspiring buyers can find a slew of new homes going up.
The area is known for its seafood and agriculture, and it offers a small-town feel that’s roughly two hours from the Washington D.C. area. Salisbury is also a top retirement destination, which may explain why buyers here are putting down some of the largest down payments in the nation.
Salisbury offers a lot of value, especially compared to nearby Ocean City, where homes were a much steeper median price of $799,900 in February.
“Salisbury offers a lot of the same quality-of-life attractions,” Ratiu says. “But it still has room to grow, where Ocean City is pretty well built out.”
On the southwest outskirts of Salisbury, about $460,000 gets a new four-bedroom home in the Village Down River community, which backs up to the Wicomico River.
4. Fayetteville, AR
Fayetteville, AR
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Single-Family New-Home Construction Permits in 2022: 5,435
Median Single-Family Home List Price: $406,400
Tucked into the Ozark Mountains of northwestern Arkansas, Fayetteville has seen a spike in the number of homes available for sale in recent months. The area’s natural beauty is a main draw for buyers. And being home to the University of Arkansas gives it a college town feel.
On the south end of Fayetteville, new-home shoppers can find a 2,000-square-foot, three-bedroom home for $294,000—far below the area’s median price. This particular house was even marked down $5,000 within the past month.
5. Austin, TX
A newly developed suburb in Austin, TX
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Single-Family New-Home Construction Permits in 2022: 20,289
Median Single-Family Home List Price: $544,375
If we’re talking about hot real estate markets, Austin usually finds itself near the top of most lists. This ranking is no exception.
The Lone Star State capital has seen one the most meteoric housing markets of the past few years—and that includes new construction. By sheer numbers, Austin had the most new single-family home construction permits issued in 2022, of all the cities on the list.
With the unofficial motto of “Keep Austin Weird,” the city is known for its art, music, and food scenes. It is home to thousands of tech startups, the annual South by Southwest Festival, and the University of Austin, which adds a youthful vibrance to the city’s downtown.
Jennifer Carey, a realtor with Open House Austin, says the area’s new-home market has offered solace to some buyers striving to compete in a market rife with all-cash offers.
“New construction was a ‘Plan B’ for a lot of our clients who were struggling to compete in the resale market,” Carey explains.
They’ve found that the new-home builders could sweeten deals for buyers in ways that existing homeowner-sellers can’t. These advantages include cash incentives that can be used at buyers’ discretion.
As Carey puts it, the bigger developers need to sell the homes they’re building, and their large size affords them the ability to negotiate creatively.
“They have the capital to offer that and get buyers in the door,” she says.
For $499,000, buyers can find a new two-bedroom home in the Montopolis neighborhood, about 15-minutes southeast of downtown Austin.
6. Raleigh, NC
A new, upscale neighborhood of single-family homes near Raleigh, NC
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Single-Family New-Home Construction Permits in 2022: 12,494
Median Single-Family Home List Price: $459,702
The Raleigh-Durham research triangle area, which abounds with science, technology, engineering, and math-related jobs, has been growing fast for decades. And new construction is playing a critical role in the area’s vibrant housing market, says Hunt, of MarketNsight.
Even with nearly 13,000 new single-family home permits issued for the metro in 2022, it doesn’t come close to satisfying the demand, he says.
In Raleigh, about 28% of home sales are new construction.
“If you could snap your fingers and have 32,000 new housing units show up in Raleigh’s supply chain, all of those would be absorbed in the next 12 months,” Hunt says.
Buyers can find three-bedroom houses with two-car garages, close to downtown for $399,900.
7. Boise, ID
Newly built luxury homes in Boise, ID
Jeremy Erickson/Bloomberg via Getty Images
Single-Family New-Home Construction Permits in 2022: 5,913
Median Single-Family Home List Price: $573,125
It’s hard to say which was the more iconic city of the pandemic-era housing market boom—Austin or Boise. The Idaho city is known for its close proximity to outdoor recreation and natural attractions.
Over the last few years, the area has experienced sky-high housing demand, as buyers flooded in from more expensive states, like California. That pushed prices up more than 60% between the beginning of the pandemic and the peak of pricing, in May 2022. And it led to a surge in construction, as builders raced to meet that increased demand.
Boise has the most expensive price per square foot of any location on this list: $267 for a median single-family home—30% pricier than the national median of $205.
Buyers can find brand-new three-bedroom, three-bath, single-family homes for $458,990 in Boise.
8. Provo, UT
A newly built home for sale in Provo, UT
Realtor.com
Single-Family New-Home Construction Permits in 2022: 5,136
Median Single-Family Home List Price: $661,925
South of Salt Lake City and bound by Utah Lake to the west and the southern Wasatch Range to the east, Provo became a popular pandemic destination. It is part of the so-called “Silicon Slopes,” named for the many tech companies and startups moving to the popular skiing destination.
The median single-family home here lists for about 60% above the national figure. But the $207-per-square-foot price is just about even with the national median. Reason: Homes in Provo are just plain bigger. The median single-family home listing in Provo is more than 3,450 square feet right now, compared to the current national median of 2,000 square feet.
For $799,900, buyers can nab a nearly 4,000-square-foot, four-bedroom, 2.5-bath home on almost a quarter acre.
9. Nashville, TN
Nashville, TN
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Single-Family New-Home Construction Permits in 2022: 15,189
Median Single-Family Home List Price: $549,945
America’s Music City has seen its housing market surge over the past several years. With more than 15,000 new single-family homes permitted here in 2022, Nashville is second only to Austin on this list.
For a little under the median single-family home listing price in Nashville, homebuyers can find a brand new three-bedroom home with modern finishes, in the Napier neighborhood. This home is within walking distance 0f the Cumberland River and about a 10-minute drive to downtown.
10. Gulfport, MS
A new-construction home for sale in Gulfport, MS
Realtor.com
Single-Family New-Home Construction Permits in 2022: 3,055
Median Single-Family Home List Price: $298,750
Located about halfway between New Orleans and Mobile, AL, along the Gulf of Mexico, this beach community stands out for a few reasons.
First, Gulfport has the most affordable homes of any place on this list. How affordable? We’re talking under $300,000, listed for about 30% below the national median.
Secondly, Gulfport has the biggest year-over-year increase in new single-family home construction permits—up 35% compared to the previous year. But even with the elevated new-home construction, finding a just-built house is not easy.
The culprit is the sky-high demand, says Angelia Clark, a broker associate and owner at Re/Max Results in Real Estate.
“There are a lot of subdivisions going up, and they’re selling fast,” she says. “Either everything is preselling or sold.”
The area’s low home prices and cost of living, combined with the appeal of a beachfront lifestyle, are driving the demand, Clark says.
“If you live in a place that’s not affordable, you should think about coming here,” she says. “You get more home for less money, plus you have the mild winters—and, yes, an occasional hurricane—but overall it’s a great quality of life.”
*Median single-family home list price includes new construction and existing homes for sale in February.
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