Builder unsold inventory jumps to 2009 levels: Housing markets where buyers can find deals

Unsold completed new US single-family homes reached 115,000 in January 2025, the highest since July 2009. This surge follows a period of low inventory and is analyzed using ResiClub's Finished Homes Supply Index. The index, calculated by dividing unsold homes by housing starts, reveals increased supply slack in the market. A higher index score indicates a weaker market with more unsold homes. This oversupply is leading some homebuilders to offer price reductions and incentives to boost sales. The excess inventory is concentrated mainly in the South, particularly in areas like Florida and Texas. Conversely, regions like the Midwest, Northeast, and Southern California have limited unsold inventory. The Sun Belt, experiencing a post-pandemic slowdown and increased mortgage rates, faces particular pressure. Builders in these areas are adjusting prices to compete, impacting both new and existing home markets. Analysts observe that this trend of increased unsold inventory is persistent, leading to pricing pressure for builders.