Sales of single-family homes in June were 0.6% below the May rate of 621,000, reaching a seasonally adjusted rate of 617,000, according to data released by the U.S. Census Bureau and the Department of Housing and Urban Development. This is significantly below—7.4%, specifically—June 2023’s estimate of 666,000 new-home sales.
Spencer Hakimian, founder of Tolou Capital Management, took to X (formerly Twitter) to blame the decrease in home sales on the Federal Reserve, who he claims guides for cuts months in advance, resulting in home and rental prices increasing, and rate cuts becoming delayed as a result.
Reacting to the new sales data, Hakimian stated, “No one sells their home because the Fed keeps guiding for multiple cuts 6-9 months in advance. Then since nobody sells their home today, housing prices and rental prices go up over those 6-9 months, which forces the Fed to have to delay those cuts when the time actually comes due. Rinse and repeat. Over and over again. Stop with the forward guidance. It’s a dumb idea…it ends up keeping monetary policy tighter for longer in the long run.”
Carl Harris, chairman of the National Association of Home Builders (NAHB), explained in a statement that potential homebuyers are also holding back from making purchases in the current market due to elevated mortgage rates of nearly 7%.
“Many potential buyers are remaining in a holding pattern due to elevated mortgage rates that averaged near 7% in June,” he said. “However, moderating inflation suggests lower interest rates in the months ahead, and that should bring more buyers off the sidelines.”
Further analyzing June’s figures, the median sales price of new homes sold was $417,300, with the average data figure at $487,200. Additionally, the seasonally-adjusted estimate of new homes for sale at the end of last month was 476,000—representing a supply of 9.3 months at the current sales rate.
“New home inventory continued to climb in June as new home stock was met with lackluster demand,” said Realtor.com® Senior Economic Research Analyst Hannah Jones. “Months’ supply of new home inventory climbed to 9.3 months, up from 7.7 months one year prior and 9.1 months in May. Despite building inventory, new home prices remained relatively flat year-over-year, dropping just $300 annually to $417,300.
“Buyers continue to see growing for-sale inventory, both in the existing and new construction segments. However, building inventory has done little to stoke buyer demand as prices remain stubbornly high. Many buyers are holding off on jumping into the market, hoping to see lower mortgage rates or lower home prices later this year,” she continued.
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