Markets & Economy

Desire for new homes smacks up against affordability

Building single-family homes riskier than building rentals

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MIAMI -- Surveys find that Americans tend to prefer new homes, but whether they can afford them is another question altogether. Few homebuilders have focused on the entry-level market in recent years, though that may be changing, according to panelists speaking at the National Association of Real Estate Editors (NAREE) conference today. A 2014 Trulia survey found that 2 out of 5 Americans preferred to buy a new home in order to enjoy more modern features, customize the home, or spend less on maintenance and repairs. But only 46 percent of people with that preference were willing to pay at least 20 percent more to purchase a new home versus a comparable existing home. About 1 in 5 Americans said they preferred existing homes, while the rest had no preference. "When asked about existing homes and why they prefer existing homes, people generally said they prefer traditional features, wanted to live in more established neighborhoods or wanted to pay less for a home," Selma He...