Homebuilders are using more buyer incentives since the election

The combination of the 2024 presidential election, anticipated future rate cuts, mortgage rate volatility and housing affordability challenges have led more potential homebuyers to stay on the sidelines. But a new report from Zonda says that after the election, consumers have started to regain their confidence in home shopping.

The New Home Market Update from Zonda, a construction data provider, was released Friday. Its survey data for November 2024 showed that 10% of builders reported that consumers were reentering the market following the election.

The builder survey contained responses like “there was a slower start to the month, but sales picked up after the election,” and “the month started slow, but things picked up mid-month.”

In November, 23% of builders lowered prices, 68% held prices flat and 9% raised prices. By comparison, in October, 18% of builders lowered prices, 69% held them and 13% increased them on a monthly basis.

“There’s no denying that incentives helped drive new home sales in November, especially for larger builders,” Ali Wolf, chief economist at Zonda, said in a statement. “Our data captured that 75% of all new home projects were offering some kind of incentive on quick move-in supply. The important difference seen in November, though, was a lift in consumer confidence. The election was over — it was time to move on.”

Zonda reported a rebound in new-home sales. Its data showed that November sales activity was 15.7% higher year over year and 17% above 2019 levels. The data provider calculated a seasonally adjusted annualized rate of 740,636 new homes sold in November — up 3.1% from October 2024.

Zonda separated homes into three pricing tiers. Home prices increased to an average of $913,999 for high-end homes, up 0.4% year over year. Prices were down 2.2% for entry-level homes, which averaged $327,682, while move-up homes in the middle tier sank 1.3% to an average price of $517,479.