New home prices in the US have fallen below existing home prices for the first time in history has circulated widely on social media like Facebook, Reddit, LinkedIn, and X posts from late 2025, often framed dramatically as a historic inversion or market shock.
However, while new homes have indeed become cheaper than existing homes in median price in recent periods. Historically, new homes typically sell at a premium over existing ones due to modern features, energy efficiency, no immediate repairs, and builder incentives.
This gap narrowed significantly in recent years due to high builder incentives/discounts, oversupply in new construction in some markets, and sticky high prices for existing homes amid low inventory and “lock-in” effects from low-rate mortgages.
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The flip (new < existing) occurred multiple times:Sporadically since at least the late 1960s (e.g., only 22 months out of 690 from 1968 onward where new undercut existing, per some analyses). More frequently in 2024–2025: It happened in several quarters/months starting around Q2/Q3 2024, and became consistent from mid-2025 onward.
Recent examples from official sources in October 2025: Median new home price = $392,300 (US Census Bureau). December 2025: Median existing home price = $405,400 (National Association of Realtors/NAR). This shows new homes ~$13,000 cheaper in late 2025.
Earlier flips: June 2025 (new ~$401,800 vs. existing ~$441,500), and similar patterns in Q2/Q3 2025 and parts of 2024. Eye On, and Benzinga noted this as a “rare” or “first in 54 years” event in specific contexts, but data shows prior occurrences, though brief and less pronounced.
Builders have aggressively cut prices and offered incentives to move inventory in a high-rate environment (mortgage rates ~6-7% in recent years), while existing home sellers often hold firm due to low supply and reluctance to lose low-rate mortgages.
New home prices fell year-over-year for multiple quarters, while existing prices rose modestly. Prices softened somewhat late 2025 but stayed elevated overall. Forecasts for 2026 suggest modest price growth (~2%) or stagnation, with slight sales improvement if rates ease.
US 30-year fixed mortgage rates are hovering in the low-to-mid 6% range, showing modest fluctuations but remaining significantly lower than the peaks of recent years (e.g., around 7%+ in parts of 2025).
Freddie Mac’s Primary Mortgage Market Survey (latest weekly data as of January 29, 2026): 6.10% for 30-year fixed up slightly from 6.09% the prior week; down from 6.95% a year ago. Other sources report slight variations due to daily/ lender differences: Zillow: Around 5.98%–5.99%. Bankrate: 6.15%. LendingTree: 6.06% (purchase loans). Mortgage News Daily/Forbes: Recent daily figures around 6.20%–6.23%. 15-year fixed: Typically lower, around 5.49%–5.50% (per Freddie Mac and Zillow).
Rates have been relatively stable in early 2026, with minor ups and downs influenced by recent Fed actions (no meeting in February, but prior cuts in 2025 contributed to the decline from 2025 highs). This stability follows a downward trend from mid-2025 peaks, driven by cooling inflation, Fed rate cuts in 2025, and bond market dynamics.
Recent Trends (2025 into 2026)
Mortgage rates peaked in early 2025 around 7%+ in some periods but declined through the year due to Federal Reserve easing. By late 2025 and into 2026, rates settled into the 6%–6.5% range, the lowest in about three years.
Year-over-year: Down roughly 0.8–1 percentage point from February 2025 levels. Lower Treasury yields, improved inflation data, and some market interventions like MBS purchases helped push rates below 6% at times in early 2026.
Experts anticipate modest further declines or stability in the mid-6% range through much of 2026, though volatility remains possible from economic data, Fed policy, inflation, or policy changes. Key projections for average 30-year fixed rates in 2026: Fannie Mae: End-2026 around 5.9% from ~6.3% end-2025.
NAR: Possibly declining to 6% from mid-6% in 2025. Mortgage Bankers Association (MBA): Steady around 6.4% early 2026. Morgan Stanley: Potentially dropping to 5.50%–5.75% mid-year before possible rise. Bankrate, Zillow and other consensus: Average around 6.0%–6.1%, with lows possibly dipping below 6% e.g., 5.7%–5.8% in optimistic scenarios and highs up to 6.5%.
Rates are unlikely to return to pandemic-era sub-4% levels soon, but the current environment (sub-6.5%) supports improved affordability compared to 2024–2025 highs. If inflation stays controlled and the economy softens mildly, further easing could occur—though stronger growth or policy shifts might stabilize or nudge them higher.
This dynamic benefits buyers seeking new construction often with discounts, but highlights broader affordability challenges in the US housing market. For the most up-to-date figures, check the US Census Bureau (new homes) or NAR (existing homes) releases.