In Pennsylvania, the typical new home costs more than double the price of an existing one
Pennsylvania was one of only two states where this was the case, according to a LendingTree report. And homebuyers here needed to make an additional six figures to afford a newly constructed home.
Choosing to buy a new home is going to cost you, especially in Pennsylvania.
It’s one of two states where the typical newly constructed home costs more than twice as much as the typical existing home, according to an analysis by LendingTree, an online lending marketplace.
Existing homes in Pennsylvania are valued at a median of $297,831, while new homes are valued at a median of $659,468 — a 121% increase.
Price gaps vary widely by state. Nationwide, the average gap is about 38%, or about $147,000. Homes in Connecticut have the largest percentage cost difference between new and existing homes — 126%. Newly constructed homes tend to be more expensive in the Northeast.
New homes tend to cost more because buyers are willing to pay more for them. Builders also face a limited supply of available land, a shortage of trade workers, and government regulations that add to the time and cost of construction.
Regulations at the federal, state, and local levels made up about 30% of the cost of new single-family homes in Pennsylvania in 2023, according to a report commissioned by the Pennsylvania Builders Association.
This all means low supply and high prices for buyers looking for newly constructed homes.
“It may sound great to buy a brand-new home and be free from all those little fixes that pop up when you buy an existing home, but that convenience comes at a steep price,” Matt Schulz, LendingTree’s chief consumer finance analyst, said in a statement. “Home buying is already expensive enough today, so be sure to ask yourself if that new home is really worth the extra cost.”
LendingTree looked at data from the National Association of Home Builders and the Census Bureau.
Pennsylvania is one of four states where homebuyers need to make over $100,000 more in annual income to afford the mortgage on a median-priced newly constructed home compared to an existing home.
Households in Pennsylvania need to make $210,643 for a median-priced new home compared to $95,131 for a median-priced existing home.
But there are six states where the median-priced existing home is more expensive than the median-priced new one. One of those is Delaware, where existing homes cost a median of $32,600 more.
In California, the state with the highest price premium on existing homes, they cost a median of $193,682 more.