Locked in place, Chicagoans renovate their homes

Chicagoans are increasingly turning to renovations as fewer homeowners want to sell.

Why it matters: A lack of inventory in most markets is fueling buyers' appetite for new construction, real estate experts say.

• Yes, but: In the city, where there's less land for development, more people are opting to fix-up the home they already have.

• "Anything being built sells for decent prices, but it's hard to find lots," Chicago builder Pat Cardoni tells Axios.

The big picture: Sales of existing U.S. homes, the great majority of houses sold nationally, slid 19% from a year earlier, while new home sales soared 24%, according to June figures.

• The new-build boost comes after rising mortgage rates curbed pandemic-driven home buying demand.
• Builder confidence is now at its highest level since June 2022, having declined every month that year, according to the National Association of Home Builders.

Zoom in: Sales of new Midwestern homes have fallen less sharply than those of existing houses.

• The number of newly built homes sold in the Midwest ebbed 13% in June compared to a year earlier, per the U.S. Census Bureau.
• Existing home sales dropped 19.5% during that time, according to regional figures from the National Association of Realtors.
• The number of listings coming onto the Chicagoland market is down roughly 31% compared to June 2022, per Redfin.

Between the lines: Cardoni says his custom building company has seen a recent jump in demand for projects like converting two-flats into single-family homes and adding short-term rental space in the basement.

Of note: There's still some new construction activity in the area, particularly in the suburbs and near Guaranteed Rate Field, where Cardoni says lots cost about $200-210 per square foot.

• Sales are up in newly built communities in the North suburbs, Madison and Milwaukee, Deborah Beaver with William Ryan Homes tells Axios.

What we're watching: Some builders are offering smaller, more affordable houses to lure first-time buyers, Axios' Matt Phillips reports.

Go deeper: Old houses now cost as much as new houses