Builders are cutting prices faster than homeowners

Success like Serhant

From afar, success can look easy. It rarely is.

Before Owning Manhattan became a hit on Netflix, Ryan Serhant pitched 69 other shows — and every one of them was rejected.

Pause on that for a second. Sixty-nine no’s before the yes. 

Ryan’s view is simple: in real estate, rejection isn’t the exception — it’s the job. Your job is to lose. Every win is a bonus. Stop taking no’s personally. You won’t last if you do. 

That’s just one of the insights Ryan and I unpacked in the latest episode of Rise Above the Ranks. 

Jump down to today’s Foundation Plans and watch it. Be ready to rethink how you approach our business.

- James

Nearly 20% of all newly built homes are selling at a discount

Homebuilders are leaning into price cuts as the market shifts toward buyers. In Q4 2025, 19.3% of new-construction listings had price reductions, compared to 18% of existing homes — the first time in recent history that new homes were more likely to carry discounts, according to realtor.com. Here are the main trends:

• Builders appear to be responding faster to shifting demand, while many existing-home sellers may choose to delist rather than reduce price.

• Price reductions are concentrated in the South and West, but states such as Indiana, Minnesota, New Jersey, Nevada, South Carolina, North Carolina, and Texas exceed the national average.

• Despite more discounts, the median new-home listing price was $451,128, up just 0.3% year over year, while existing-home prices were essentially flat.

• Builders are acknowledging affordability pressures and weaker demand; Lennar reported an average delivered sales price of $386,000, down 10% year over year.

• A notable shift: New condos and townhomes are now more expensive than new single-family homes, largely because condo construction is concentrated in high-cost metros like New York City and Miami.

• New single-family construction is more prevalent in relatively affordable markets such as Houston, Dallas, San Antonio, Atlanta, and Phoenix, helping to fill supply gaps at lower price points

My take

Builders are moving faster than individual homeowners. Instead of waiting it out, they’re cutting prices to keep inventory turning — which is why new homes now carry more discounts than existing ones. Prices are technically up, but once you factor in incentives, margins are clearly thinner, especially in rate-sensitive single-family markets. Leverage is tilting toward buyers, but they are very anxious about the economy, so they need a lot of reassurance and guidance. Use this data to show them the leverage they have, and help them feel confident using it.

Pending sales drop in 45 of the 50 largest U.S. metros

U.S. pending home sales fell 5.1% year over year, the largest drop in over a year. According to Redfin, sales declined in 45 of the 50 largest metros. Here are the other data points the listing service reports.

• Pending sales increased in just four markets: West Palm Beach (+9.1%), Jacksonville (+7.7%), Columbus (+1.4%), and Chicago (+0.1%). Austin was flat.

• The biggest declines were in Oakland (-21.6%), Minneapolis (-17.5%), Houston (-17.3%), and Nashville (-16.4%).

• Homes are taking longer to sell. The median days on market rose to 66 days, the longest span in roughly seven years.

• There are 5.5 months of supply, the highest level in seven years. While 4–5 months is considered balanced, today’s levels signal a buyer-leaning market.

• The median sale price increased 1.2% year over year to $378,725, while the median asking price rose 2.3%.

• The median monthly housing payment fell 3.8% year over year to $2,580, while wages are up about 4%, helping narrow the affordability gap.

• New listings declined 1.8% year over year, and active listings fell 0.8%, marking the first inventory decline since 2023.

• Buyers have leverage. Only 19% of homes are selling above list price, and the average sale-to-list ratio is 97.7%, indicating room for negotiation.

My take

When pending sales fall in 45 of the 50 largest metros, that’s not noise — it’s a signal of broad hesitation. Buyers have leverage and are acting like it: they’re price-sensitive, rate-sensitive, and willing to wait patiently rather than rush into deals. What stands out, though, is that prices are still edging higher and inventory isn’t surging. That points to a slowdown, not a breakdown. For now, conditions favor buyers, but if rates hold near 6% and spring demand builds, that window of leverage could narrow quickly.

California reopens its downpayment assistance program

California is reopening its down payment assistance program, offering up to $150,000 for eligible first-time homebuyers. Later this month, the California Housing Finance Agency (CalHFA) will begin accepting applications for its Dream For All Shared Appreciation Loan Program, which provides substantial upfront support to qualified buyers. 

Here are the important details to know:

• Up to 20% down payment assistance – Eligible first-time buyers can receive up to 20% of the home’s purchase price or appraised value to use toward their down payment. It maxes out at $150,000.

• $200 million allocated for 2026 – The state expects to make up to $200 million available through this funding round.

• Randomized approval process – Applicants will be selected through a random lottery system, rather than first-come, first-served.

• Limited application window – Applications open Tuesday, February 24, and close March 16.

• 90 days to secure a home – Buyers who receive conditional approval will have 90 days to shop for and purchase a property.

My take

Right when we saw this, we wanted to flag it for our California readers — the application window is just 21 days, starting February 24. Programs like this create urgency. Urgency creates action. If you work with first-time buyers, this is your cue to call them. Most buyers don’t know these programs exist, and by the time they find out, it’s too late. Agents who win don’t react to headlines — they use them to start conversations. Don’t just forward the link. Call your clients now.

Schematics

The news that just missed the cuts

• The McMansion era in real estate is over 

• The traditional wood-burning fireplace is going extinct – here’s why

• The prospecting shift that helps agents get inside more homes

• Why the mega-rich are turning their homes into impenetrable fortresses

• The top AI tools agents should be using

Foundation Plans

Advice from James to win the day

As I said up top, I recently sat down with Ryan Serhant for a candid and revealing conversation about success, failure, and what it really takes to win in real estate. Ryan said something that might surprise you, but it’s something many agents need to hear: if he could rewind the clock, he’d focus less on passion early and more on stacking wins. Build momentum first — confidence and fulfillment tend to follow. 

We covered a lot of ground. If you take his advice to heart, it will change your mindset and how you approach the whole game as an agent. Here are some of the themes and topics we chatted about. 

1. Treat rejection as the job, not the exception. If you expect to lose most of the time, you stop getting emotional about outcomes and start playing the long game. The agents who last are the ones who can absorb 10 no’s without slowing down on the 11th call.

2. Prospecting isn’t “lead gen” — it’s relationship creation. Your job isn’t to close strangers; it’s to meet people, build familiarity, and stay relevant until their timing lines up. Aim to meet 10–15 new people a day and build a simple follow-up system — that alone can change your production.

3. Follow-up is the real superpower. Not annoying — humbly persistent. Most deals go to the agent who stayed present, not the one who impressed first. Professional persistence — without being pushy — is what turns months of silence into signed agreements.

4. Build your business like a flywheel: content → community → commerce. If you’re not building brand today, you’re starting from zero every January. Use platforms like LinkedIn, Instagram, and TikTok strategically — not for vanity, but to stay visible where real owners and buyers actually spend time.

5. Attack the market that exists — not the one you wish we had. Go after the listings that didn’t sell, the homes that became rentals, the buyers who think they’re priced out — and collaborate across markets to create deal flow and better client service. The agents who win in 2026 will be the ones who proactively reposition existing opportunities rather than waiting for perfect conditions.

There is so much we covered in this episode, like how Ryan uses the lessons from improv in his life as an agent. And, don’t miss the part where I share my backup plan. All I’ll say is that it involves my wife’s beautiful feet!

Watch and listen to the whole episode and tell me what you think. I think you’ll love it.

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

“Intensity is the price of excellence.” – Warren Buffett

Excellence and success aren’t accidental, friends. They require intense focus, unwavering commitment, and sustained effort over time. But if you put in the work, success compounds, and the results can be extraordinary.

- James