Minnesota Buyers: Don’t Overlook New Construction

When I talk with buyers about new construction, one of the first things I often hear is:

“Isn’t building new more expensive?”

Historically, that’s been a pretty fair assumption. But today’s market is creating some interesting opportunities — and in some cases, a brand-new home may actually cost less than an existing home.

That’s why I don’t want Minnesota buyers automatically crossing new construction off their list before we’ve looked at the numbers.

New Construction Is Competing for Buyers

According to recent national data from the U.S. Census Bureau and the National Association of Realtors, the typical newly built home is currently priced about $40,000 less than the typical existing home.

That’s a pretty significant shift.

Why is it happening?

Builders have inventory they need to sell. Unlike an individual homeowner who may be able to wait for the right buyer, carrying unsold homes costs builders money. So when inventory starts stacking up, builders have a strong incentive to make their homes more attractive.

And they’re doing exactly that.

Recent data from the National Association of Home Builders shows:

• 35% of builders reduced prices, with an average price reduction of 6%.

• 63% of builders offered buyer incentives, which can include closing-cost assistance, mortgage-rate buydowns, upgrades, or other financial incentives.

For buyers, those incentives can sometimes make a much bigger difference than simply looking at the sticker price.

A lower interest rate could reduce your monthly payment. Closing-cost assistance could mean bringing less cash to closing. Included upgrades could save you thousands after you move in.

And, of course, there’s something pretty appealing about moving into a home where the roof, furnace, appliances, flooring, windows, and everything else are brand new.

But Does This Mean Every New Home Is a Better Deal?

No — and this is where strategy matters.

Real estate is local, and even within Minnesota, pricing and incentives can vary considerably from one community and builder to another.

A builder may advertise an amazing interest rate, but that rate could require using their preferred lender or choosing a particular home. Another builder might be more flexible on price but offer fewer incentives.

And sometimes an existing home is still the better value.

The goal isn’t simply to buy new.

It’s to compare your options and figure out which home gives you the best combination of price, monthly payment, location, features, future expenses, and long-term value.

One Important Thing Before You Visit a Model Home

This is something I wish every buyer knew before walking into a new construction sales center:

The builder’s sales representative represents the builder.

They can absolutely be helpful, knowledgeable, and wonderful to work with — but their responsibility is to the builder.

That’s why I recommend having your own REALTOR® involved before your first visit or registration with a builder.

Depending on the builder, there may be specific rules about when your agent needs to be registered with you. Walking into a model home first and calling an agent afterward can potentially change your representation options.

Having your own agent means you have someone looking at the transaction specifically from your side of the table.

I can help you compare the builder’s pricing with existing homes and other new construction communities, evaluate incentives, understand upgrade costs, negotiate where opportunities exist, review timelines and contract details, and help you navigate inspections and the closing process.

And yes — I still recommend inspections on new construction.

Brand new doesn’t automatically mean perfect.

The Opportunity Minnesota Buyers Shouldn't Overlook

If you’ve been searching for a home and assuming new construction is outside your budget, it may be time to take another look.

There are builders competing for buyers right now, and depending on the community, there may be opportunities involving price reductions, rate buydowns, closing-cost assistance, or upgrades.

Sometimes the best deal isn’t the home with the lowest asking price.

It’s the home that gives you the best overall financial picture.

Bottom Line

Before deciding between new construction and an existing home, let’s compare both.

If you’re considering buying in Minnesota, I can help you identify new construction communities in the areas you’re considering, compare current builder incentives, and determine how those options stack up against existing homes.

And if you’re thinking about touring model homes, reach out to me before you go. I’ll make sure you understand your options and have someone representing your interests from the very beginning.

Helping you move with confidence. Serving you on your timeline. Building relationships, not transactions.

Chrissy Peterson, REALTOR®Chrissy J Homes Team | eXp Realty