The median price of an existing home in December was $198,000, according to the National Association of Realtors, while that of a newly built home was $270,200, according to the U.S. Census. Price growth for new homes is easing slightly, but builders are hard-pressed to offer bargains.
"When the median price rises, it signifies that there are fewer homes available on the inexpensive end of the spectrum, which is problematic when job and income growth have been lackluster," IHS Global's Patrick Newport said in a note to investors. "Construction costs have been accelerating year-on-year for the past five months, causing prices to mount despite easing inventories."
(Read more: All-cash offers crushing first-time homebuyers)
That's why all-cash is king in the existing home market, where there are still some bargain-priced homes. All-cash buyers made up at least 32 percent of buyers of existing homes in the month, according to the Realtors. Crowe said just 6 percent of new home buyers used all cash in the fourth quarter of 2013. That'is because there are few investors in the new home market, while investors have been fueling the low end of the existing home market and driving sales overall higher.
A still-tight mortgage market is also having an outsized negative impact on the new home market. First-time home buyers, who have historically been a major cohort for the home builders, are more dependent on the mortgage market, which has only loosened very slightly in the past year. The FHA, the government insurer of low down payment loans, has been a favorite among first-time buyers, but that product is now more expensive, adding to the first timer's absence in the market.