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New Home Sales Activity And Prices Continue To Cool

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New home sales totaled 617k in June, below the 640k expected and 621k prior (+2k upward revision), amid a soft report overall.

  • June's sales marked the lowest seasonally-adjusted annual rate since November 2022, and came alongside a 0.1% Y/Y decline in median prices ($417.3k), the 6th in 7 months. While selling prices were the highest since March, those figures are not seasonally-adjusted.
  • The flat price growth in new homes contrasts with modest positive existing home price readings (+4.1% Y/Y in June), with both inventory and lingering high mortgage rates weighing.
  • With 476k new homes for sale at the end of the month - the most since 2008 - there is now 9.3 months of supply on the market, up from 9.1 prior. While that is lower than the 10.6 month peak in July 2022, it's up from 7.7 a year earlier and is clearly trending higher again.
  • The outlook for new home sales remains subdued. While mortgage rates have eased slightly, potentially underpinning demand, latest data continue to show weak growth in mortgage applications for outright purchases.
  • Additionally, new home inventory looks set to continue rising: while single family house construction starts have been moderating, at 980k in June 2024 they remain above levels seen in late 2022/early 2023 and pre-pandemic.

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New home sales totaled 617k in June, below the 640k expected and 621k prior (+2k upward revision), amid a soft report overall.

  • June's sales marked the lowest seasonally-adjusted annual rate since November 2022, and came alongside a 0.1% Y/Y decline in median prices ($417.3k), the 6th in 7 months. While selling prices were the highest since March, those figures are not seasonally-adjusted.
  • The flat price growth in new homes contrasts with modest positive existing home price readings (+4.1% Y/Y in June), with both inventory and lingering high mortgage rates weighing.
  • With 476k new homes for sale at the end of the month - the most since 2008 - there is now 9.3 months of supply on the market, up from 9.1 prior. While that is lower than the 10.6 month peak in July 2022, it's up from 7.7 a year earlier and is clearly trending higher again.
  • The outlook for new home sales remains subdued. While mortgage rates have eased slightly, potentially underpinning demand, latest data continue to show weak growth in mortgage applications for outright purchases.
  • Additionally, new home inventory looks set to continue rising: while single family house construction starts have been moderating, at 980k in June 2024 they remain above levels seen in late 2022/early 2023 and pre-pandemic.