After a big jump in May, new-home sales dropped 2.5% to a rate of 697,000, according to the latest data from the U.S. Census Bureau and the Department of Housing and Urban Development.
“Rising mortgage rates in June, coupled with elevated construction costs and supply chain issues for electrical transformers, acted as headwinds on the new-home sales market,” said Alicia Huey, chairman of the National Association of Home Builders (NAHB), in a statement.
Compared to May’s month-over-month jump of 12.2% new-home sales have definitely reversed course, but they are maintaining year-over-year growth at 23.8%.
Regionally, the Northeast was up 20.6%, the Midwest was down 28.4%, the South was up 4.3% and the West was down 13.9%. Year-over-year, the Northeast was up 141.2%, the Midwest was down 13.1%, the South was up 21.4% and the West was up 34.9%.
As for home prices, the median sales price of new houses sold was $415,400, a slight drop from last month’s $416,300. The average sales price was $494,700. In addition, the seasonally‐adjusted estimate of new houses for sale was 432,000, representing a supply of 7.4 months at the current sales rate.
“Demand for new homes cooled in June primarily due to a more than quarter-point rise in mortgage rates over the previous month,” said Danushka Nanayakkara-Skillington, NAHB’s assistant vice president for forecasting and analysis. “However, the lack of existing inventory and the Federal Reserve nearing the end of its rate hikes signal that demand for new homes may rise in the coming quarters.”
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