As the Pittsburgh region emerges from a harsh winter, the spring 2025 housing market is showing all the signs of continuing last year’s competitive trends. Early indicators are for demand to outpace supply and multiple offers for every available property the norm rather than the exception.
For many prospective homebuyers, particularly first-timers and downsizers, new construction has emerged as not just an alternative but often the only viable path to homeownership in a market characterized by bidding wars and rapidly escalating prices.
With existing home inventory at historic lows and sellers reluctant to give up their favorable mortgage rates, builders across the Greater Pittsburgh area are facing unprecedented demand—even as they grapple with their own challenges of land availability, rising costs, and increasingly complex municipal requirements.
This spring may prove pivotal for the region’s housing market, as buyers who have spent months or even years on the sidelines waiting for interest rates to drop have largely resigned themselves to the current financial reality and are moving forward with purchases.
The question now becomes whether new construction can fill the gap left by the resale market’s ongoing inventory drought, and what compromises buyers might need to make as they navigate one of the most challenging spring markets in recent memory.
Market dynamics driving demand
The new housing market is expected to be in demand this spring, as prospective homebuyers grow weary of a persistent low inventory problem, said JoAnn Echtler, a licensed realtor with Berkshire Hathaway Home Services. “I expect that it will be as strong – if not stronger – because so far this spring, every resale house that has hit the market that I’ve been involved with has had multiple offers above asking price and has sold quickly.”
The new home market is expected to see demand as strong as—if not stronger than—previous years. With resale properties receiving multiple offers and selling quickly, many buyers are turning to new construction as their only viable option.
Echtler said first-time homebuyers who find themselves repeatedly outbid in multiple-offer situations on existing homes have grown weary of the experience. “With starter homes now averaging around $350,000 – significantly higher than historical first-time home prices – many are gravitating toward new construction where they face no competition except their own budgets.”
Another pressure on the market this spring is retirees and downsizers seeking one-level living arrangements, particularly ranch-style homes with main-floor master bedrooms and attached garages. “The scarcity of these features in existing inventory is driving this demographic toward custom builds,” said Echtler.
David Bruckner, director of sales for DR Horton, said the new home builder has seen an influx of demand for new homes over the last couple of years. DR Horton is one of the largest new home builders in the Pittsburgh region, with 23 new home communities and plans to open four or five additional new home communities before year’s end. “In the Pittsburgh market, there’s always demand for ranch-style, first-floor bedroom homes because of the demographics,” he said. “We’re also seeing an increase in our first or second-time move-up buyers who just need more space.”

Supply constraints push buyers toward new
Despite strong demand, new home construction faces significant challenges. Land availability has become a critical issue, complicated by an increase in municipal and zoning requirements. Echtler said this is particularly problematic for developers looking to build townhomes or homes on smaller lots, which are desperately needed in the market. “The availability for these builders has become quite slim. We need these homes badly, but the lack of land and the increase in the zoning requirements is putting a stranglehold on new home builders.”
Even younger buyers are showing a strong preference for updated, move-in-ready properties rather than fixer-uppers requiring expensive – or extensive – renovations. “The idea of it being new – the systems and design – seems to be more important than having a single-family home they can’t afford,” Echtler said.
Bruckner said DR Horton isn’t experiencing any supply chain issues right now that would restrict their growth plans for this year. The COVID-19 pandemic taught them how to set up systems and processes to avoid the kind of supply chain issues that can negatively impact new builds.

Interest rate realization setting in
As of mid-March, the national average for a 30-year fixed mortgage rate was 6.67 percent, while the 15-year fixed rate hovered around 5.93 percent, according to Bankrate. With the economy struggling, it’s unclear whether homebuyers can expect any interest rate cuts this year.
Echtler said buyers have largely come to grips with current interest rates after waiting for over a year for significant drops that haven’t materialized. Many are now proceeding with purchases despite higher rates, with the rationale that they can always refinance if rates decrease in the future. She said she encourages her clients not to wait for lower interest rates if they see a home they want because inventory isn’t guaranteed to improve, and they may miss out on the opportunity.
“I tell them this is your rate now,” she said. “Look on the bright side. If they go up, then you’ve got the lowest rate. If they decline, you can always refinance. But at least you’re in a house and not still paying rent and getting nothing out of it.”
Interestingly, higher rates are influencing many buyers to prefer new construction, reasoning that if they’re going to pay more in interest, they want to avoid the additional expenses associated with older homes, she said.
Bruckner said the mortgage companies DR Horton works with have pivoted to other aggressive loan programs to compensate for the anxiety over higher interest rates. Rate buy-downs are a popular incentive when interest rates are high. The builder pays money upfront to reduce the buyer’s mortgage interest rate, resulting in lower monthly payments. This approach allows builders to sell homes without lowering prices, while giving buyers a financial break in the crucial first years of homeownership. “We like to say marry the house and date the rate,” he said.
Economy impacting buyers more than sellers
The current economic situation is affecting sellers more than buyers, creating a cycle that exacerbates inventory shortages, said Echtler. Homeowners with no mortgage or low interest rates are reluctant to sell and take on new financing at much higher rates. This has created a market where “people move because they have to now, not because they want to,” she said, further reducing available listings.
Echtler said she doesn’t anticipate this dynamic changing “unless we get rates with a 5 in the first number,” considered “the magic number for sellers who have real reasons to get out of their homes.” As a result, buyers should not expect price relief, with construction costs continuing to rise and builders charging accordingly.
Bruckner said one of the strategies DR Horton uses to keep new homes more affordable – especially during tough economic periods – is to explore ways to maximize the space so it improves the quality of life without increasing the cost of the home.

Recommendations for buyers
Usually by the middle of March, the spring influx of available homes would peak. However, given the long and harsh winter the Pittsburgh region experienced this year, Echtler said the spring selling season is starting later than usual.
Buyers concerned about affordability should research resale and new construction options before making any decisions, she suggested. “Working with experienced realtors who can explain the pros and cons of each option is highly recommended. This should not be a waiting game, as prices are not expected to decrease anytime soon.”
Current bidding wars resemble those seen during the COVID-19 pandemic, she said. “While it’s still early in the spring season, there’s little indication that the competition will ease up anytime soon.”
For those considering new construction, location remains a top consideration. Echtler said the neighborhood and the specific placement of the home within the community are crucial factors that should guide purchasing decisions.
Bruckner said although prices seem high, Pittsburgh is still a favorable market compared with the rest of the U.S. “Pittsburgh is such an interesting market,” he said. “We’ve always been the little engine that could. We didn’t see the spikes during the housing bubble, nor did we see the drop-offs. Pittsburgh has always been an affordable place to buy.” NH