Sales of newly built homes decreased by 5.6% in October to a 679,000 annualized rate as high mortgage rates weighed on demand.
Despite the decrease, new-home sales have generally been rising for the past year as buyers face an affordability crisis and builders use incentives to draw buyers.
Mortgage rates peaked last month near 8%, but have since receded on expectations that the Federal Reserve is nearing the end of its tightening cycle, potentially boosting resale inventory and buyer demand.
The median sales price of new homes dropped to $409,300 in October. That’s 17% lower than a year ago, but prices are still higher than pre-pandemic levels.
Inventory increased to its highest level since January. But sales were down in the Midwest and West.
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