New Home Sales Plunge as High Prices and Rising U.S. Mortgage Rates Discourage Buyers

Abstract

The numbers: Sales of new homes in the U.S. fell in April for the fourth month in a row to the lowest level since the pandemic owing to high prices and soaring mortgage rates. That's how many homes would change hands in a full year if the number of sales were the same in every month as they were in April. Key details: Sales fell in all four major regions of the country, but the largest decline occurred in the South, where about half of all new homes are built. The average home price was even higher at a record $570,300, underscoring that the majority of properties for sale are on the more upscale side. The slowdown in sales, on the other hand, boosted the inventory of new homes on the market to a 14-year high of 444,000. The last time that many homes were for sale was in 2008. There's still not enough homes for sale to sharply reverse the upsurge in prices over the past few years.