Why Builders May Be Offering Better Deals Than Homeowners

Here’s something many homebuyers may not realize. When the housing market slows, homeowners and builders often approach selling very differently.

Consider this: If you’re selling your home and the offers aren’t meeting your expectations, you have the option to take it off the market, stay where you are, and wait for conditions to improve.

Builders, however, often face a different situation and may have more incentive to keep moving forward with a sale.

They’ve already committed significant money to constructing those homes. And every finished home that remains unsold ties up capital while carrying costs continue to accumulate.

That’s why some builders may be more willing to negotiate in today’s market, creating potential opportunities for homebuyers.

Buyer Activity Is Slowing, and Builders Are Feeling the Pressure.

You may have noticed the recent report about slowing home sales. According to the latest report from the National Association of Realtors (NAR), pending home sales—properties under contract but not yet closed—declined 7.3% in September and 11.3% compared to the same time last year.

What’s driving the slowdown? Higher mortgage rates are making affordability more challenging for many buyers. While these figures reflect existing homes rather than new construction, similar signs of reduced buyer activity are emerging in the new-home market as well.

According to the National Association of Home Builders (NAHB), builder confidence fell to 29 in October, marking its lowest point since June 2012. Meanwhile, prospective buyer traffic also declined to its lowest level in over a decade, aside from the early months of the pandemic.

As Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), points out:

“Buyer demand is still there, but rising mortgage rates, high construction costs, and declining consumer confidence are causing more potential homebuyers to delay their purchasing decisions.”

Here’s what that means for you as a buyer.

While a homeowner may have the flexibility to hold out for a better offer, a builder with multiple completed homes still on the market may have greater incentive to sell sooner rather than wait.

That could give you more room to negotiate than you might expect. Is this conversation helpful so far?

Builders Are Offering More Incentives To Attract Buyers

If you think builders aren’t willing to negotiate, the latest data may surprise you. According to the October survey from the National Association of Home Builders (NAHB):

• 65% of builders are providing incentives to attract buyers.
• 43% are reducing home prices, the highest percentage reported from 2020 through 2026.
• 6% is the average price reduction among builders offering discounts.

The numbers make it clear: builders are willing to negotiate. And with buyer demand slowing, now may be a good time to find out just how much flexibility they’re willing to offer.

That could include negotiating a lower purchase price, securing a mortgage-rate buydown, getting assistance with closing costs, or requesting upgrades that might otherwise come at an additional expense.

Here’s another strategy that could give you an advantage when shopping for new construction.

Instead of focusing only on brand-new developments or beautifully staged model homes, pay attention to builders with completed homes that are still available.

Often referred to as quick move-in homes or spec homes, these properties are already built and ready for buyers. The longer they remain unsold, the more motivated a builder may become to negotiate a deal and reduce their ongoing carrying costs.

Don’t Just Explore Your Options. Explore Your Negotiating Power.

Don’t automatically assume the listed price or advertised incentives represent the best deal a builder is willing to offer.

That’s where working with an experienced real estate agent can make a difference. An agent familiar with your local market can help you evaluate builder incentives, identify developments with higher inventory, and uncover potential opportunities to negotiate more favorable terms.

Keep in mind that builder incentives can vary significantly. Some may be willing to reduce the purchase price, while others may offer greater flexibility with closing cost assistance or mortgage-rate buydowns.

That’s why it’s always worth exploring your options and asking what’s possible.

The key is knowing which builders may be more motivated, what incentives to negotiate, and where opportunities exist to secure a better deal. Having an experienced real estate agent on your side can make all the difference.

Bottom Line

Homeowners may have the flexibility to wait for an offer that meets their expectations, but builders with completed, unsold homes often face different financial pressures. That could create valuable opportunities for buyers looking to negotiate a better deal.

If you're considering buying a home, connect with a local real estate agent to explore move-in-ready new construction in your area. You may be surprised by the incentives and negotiating opportunities some builders are willing to offer.