U.S. new-home sales rose in July to the highest level in over a year as
Purchases of new single-family homes increased 4.4% to an annualized 714,000 pace after downward revisions to prior months, government data showed Wednesday. The median estimate in a Bloomberg survey of economists called for a 703,000 pace.
In a seven-day period that saw several marks — including conforming interest rates — surge or dip past longtime highs and lows, overall mortgage activity cooled for a fifth consecutive week, according to the Mortgage Bankers Association.
With mortgage rates at the highest level in more than two decades, most homeowners are unwilling to move, keeping inventory on the resale market extremely limited. That's encouraged prospective buyers to seek out new construction, and builders are also throwing in more incentives.
However, the recent pickup in mortgage rates is
At the same time, a combination of tight supply and high costs continues to weigh on affordability. The median sales price of a new home climbed to $436,700 from a year earlier, according to the Commerce Department's report. That's well above pre-pandemic levels.
The number of homes sold in July and awaiting the start of construction — a measure of backlogs — declined to lowest level this year.
The data showed there were 437,000 homes for sale as of the end of last month. That represents 7.3 months of supply at the current sales rate, matching the lowest since early 2022.
Sales rose in the Midwest and West to the highest level since early last year, while they fell in the Northeast and South.
New-home sales are considered a timelier barometer than purchases of previously-owned homes, which are calculated when contracts close. Those sales fell to the lowest
The new-homes data are volatile. The report showed 90% confidence that the change in sales ranged from a 8.4% decline to a 17.2% gain.
