You can get a deep discount on a brand-new home in these 10 US hot spots right now, as desperate builders slash prices up to 69% to boost sales

Home builders are the ultimate motivated sellers. While homeowners can list older homes for resale and let them sit, builders need to sell at speed to recover costs and turn a profit.

If their homes don’t move fast enough, builders offer incentives and discounts.

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“Builders are a little more ahead of the game than resellers when it comes to offering price reductions,” Joel Berner, a senior economist at Realtor.com, told Moneywise. “They’re more aggressive with the same pool of buyers.”

They’re cutting prices with increasing regularity, according to the National Association of Home Builders (NAHB). Marketwatch reports that nearly 4 in 10 builders are turning to price reductions to move inventory.

As a result, many new-build homes are selling for less than resale homes — with a median sales price of $403,200 compared to $404,600. While that may not sound like a big difference, it’s a major turnaround. Typically, new homes sell for more, not less.

And depending on where you buy a home, you can get a much deeper discount. Here’s what’s going on.

Where builders are offering deep discounts

Builders are grappling with flagging demand as a growing number of home buyers sit on the sidelines, Berner said.

“There’s a lot of buyer trepidation,” he told Moneywise. “People are not feeling that it’s a good time to buy a home.”

Part of that is soaring home prices, which have climbed 36 months in a row, reaching an all-time high in June, according to the National Association of Realtors. Another factor is rising mortgage rates, with the average 30-year mortgage sitting at nearly 6.8% as of July 22.

That’s why builders are offering discounts on new homes: to entice buyers off the sidelines. Yet the discounts vary.

“Really what we see across the country is regional divide,” Berner said, noting that there are huge price reductions in the South and the West, where you can find discounts of up to nearly 70%.

Here’s a look at the 10 hot spots where builders are offering the biggest deals, according to Realtor data shared with Moneywise.

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Southern cities see price cuts from 30% to 48.5%

• Charleston-North Charleston, South Carolina — prices reduced 48.5%
• San Antonio-New Braunfels, Texas — prices reduced 45.3%
• Austin-Round Rock-San Marcos, Texas — prices reduced 32.4%
• Greensboro-High Point, North Carolina — prices reduced 32.3%
• Dallas-Fort Worth-Arlington, Texas — prices reduced 31.1%
• Winston-Salem, North Carolina — prices reduced 30.2%

Western cities see price cuts from 30% to 69%

• Fresno, California — prices reduced 68.8%
• Las Vegas-Henderson-North Las Vegas, Nevada — prices reduced 41.6%
• Phoenix-Mesa-Chandler, Arizona — prices reduced 32.1%
• Denver-Aurora-Centennial, Colorado — prices reduced 30%

In contrast, builders are offering relatively small discounts of up to 11% in the Northeast and Midwest. The exceptions are Minneapolis-St. Paul, Minnesota and Bloomington, Wisconsin, where builders are offering discounts of up to 27.1%.

What the South and West have better deals on new homes

Berner explains that builders have been focused on new homes in southern and western states where construction costs are lower.

As a result, their inventory of new homes has built up in those regions. High supply and relatively low demand with buyers on the sidelines add up to price reductions.

“This list of 10 has enough new homes,” Berner says of the hot spots.

But he believes the 21st Century ROAD to Housing Act will change that equation, driving more new-home construction in the U.S. Northeast and West — places where home prices are highest and supply is lowest.

“There are provisions in the bill aimed at loosening zoning requirements that are going to be really impactful,” he said.

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