Sales of newly constructed homes in the U.S. fell to the lowest level since March as prices stayed elevated and buyers are discouraged by high mortgage rates.
Sales of new single-family houses dropped 8.7% to an annual rate of 675,000 from a revised 739,000 in July, the Census Bureau and the Department of Housing and Urban Development said Tuesday. Sales rose 5.8% from a year earlier.
The average price of new homes rose 1.2% from July to 514,000, according to the report. The seasonally‐adjusted estimate of new houses for sale was 436,000, which represents a supply of 7.8 months.
The national average for a 30-year fixed mortgage rate reached a 2023 high of 7.23% in August. As of Sept. 21, the average 30-year fixed mortgage rate was at 7.19%, according to Freddie Mac. The new figure is close to the highest level in two decades.
Mortgage rates are affected by the Federal Reserve’s fight against inflation. Policy makers maintained the benchmark rate unchanged in the range of 5.25% to 5.5% on Sept. 20. It’s the highest level since 2001. Fed officials have indicated that another hike may be necessary this year.
