St. Louis Housing: Win in a Slow Construction Market

Written by David Dodge 

Hey, St. Louis homebuyers! If you’re out there hunting for your dream home in 2025, you’ve probably noticed things are getting a bit tricky. The word on the street is that new home construction is slowing down big time. According to St. Louis Real Estate News, five out of seven counties in our area saw a double-digit drop in new home permits this year. That’s a big deal, and it’s shaking things up for folks trying to buy a place. With home prices creeping up and fewer houses to go around, it’s a tough market out there. But don’t worry—I’ve got your back. Let’s break down what this slowdown means and how you can still score a great home in St. Louis.

What’s Behind the Construction Slump?

So, why are we seeing fewer new homes pop up? It’s a mix of things. MMG Real Estate Advisors says St. Louis only kicked off 975 new units in 2023, the lowest since 2019, and 2025 isn’t looking much better. Builders are getting hit hard with sky-high material costs, not enough workers, and tougher zoning rules. Plus, St. Louis Real Estate News points out that borrowing money to build is pricier than ever, so developers are holding back. This means fewer shiny new houses in hot spots like Kirkwood or Chesterfield, where everyone’s fighting over the same few listings.

How It’s Hitting Buyers

With new homes in short supply, you’re probably looking at existing houses instead. But here’s the catch: there aren’t many of those either. Redfin says St. Louis had just 1,549 homes for sale in April 2025, with a median price of $224,997—that’s up 3.4% from last year. And get this: House Sold Easy found that 44.6% of homes in St. Louis County sold above asking price last month. That’s right—bidding wars are real, and you’ve got to move fast.

If you’re a first-time buyer, this can feel like a punch to the gut. New homes are usually move-in ready, with those sweet modern touches and no immediate repair headaches. But with fewer being built, you might be looking at older homes in places like University City or Ferguson that could need some TLC. It’s not ideal, but it’s not a dealbreaker either if you know how to play your cards right.

Silver Linings in the Slowdown

Okay, it’s not all doom and gloom. There are still ways to make this market work for you. For one, townhouses and condos are having a moment. House Sold Easy says inventory for these jumped 43.8%, and St. Louis Realtors backs that up with a whopping 57.1% spike in townhouse/condo listings. These are great for anyone who wants a low-maintenance home or a cheaper way to get into the market, especially if single-family homes are out of reach.

Another bright spot? Up-and-coming neighborhoods like Botanical Heights or Fox Park. Steadily notes these areas are getting a lot of buzz for their affordability and cool community vibes. If you’re okay with a bit of a fixer-upper or want a home that could grow in value, these spots might be your ticket.

How to Come Out on Top

Want to beat the competition and snag a home? Here’s what I’d do:

1. Get Pre-Approved ASAP: Homes are selling in about 21 days, per Steadily. A pre-approval shows sellers you mean business and can give you a leg up when the bidding starts.
2. Team Up with a Local Realtor: A good agent knows the ins and outs of hot neighborhoods like Clayton or Ladue, where House Sold Easy says prices could climb big time.
3. Look at Loan Options: Mortgage rates are bouncing between 6.13% and 7%, according to Houzeo. House Sold Easy suggests checking out FHA or VA loans to keep your offer competitive.
4. Don’t Rush, But Don’t Dawdle: Some homes are sitting for up to 44 days now, per House Sold Easy, compared to 22 days last year. That gives you a bit more time to think, but don’t sleep on a good deal.
5. Check Out Back-on-Market Homes: Listings that come back on the market—often because a buyer’s financing fell through—can be goldmines. Sellers are usually eager to close, so you might score a better price.

What’s Next for St. Louis?

Looking ahead, the St. Louis market is staying hot. House Sold Easy predicts home prices will jump 5-7% in 2025, so waiting too long could cost you. The construction slowdown isn’t going away anytime soon, but that just means you’ve got to be smart and move fast.

Whether you’re a first-timer or looking to invest, don’t let the tight market scare you off. Get with a local realtor, explore up-and-coming areas, and keep your financing ready. St. Louis is still full of opportunities—you just need to know where to look. Ready to dive in? Let’s find you that perfect home!