• New sales slowed to a 591,000 annual rate from 709,000 last month
A report by the US Department of Housing and Urban Development stated that sales of new single-family houses in the U.S. dropped significantly more than expected last month to the lowest level in two years.
The report attributed the decrease to rising construction costs, home prices, interest rates, and supply chain issues.
New sales slowed to a 591,000 annual rate from 709,000 in the prior month, the government said Tuesday.
The drop is 26.9% lower than a year ago, and the lowest since April 2020. This is the fourth straight month new home sales have declined.
Last month, the median sales price of new homes hit $450,600, from $435,000. As interest rates rise above 5%, the increasing cost of home-ownership is pricing more would-be buyers out of the market.
This combination of high prices and rising mortgage rates since last fall, has made homeownership less affordable for a lot of would-be buyers.
Sales fell in all four major regions of the country, but the largest decline of 20%, occurred in the South, where about half of all new homes are built.
Source - Census Bureau
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