Aug. 26, 2013 – New-home sales decreased in July, most likely due to rising mortgage rates, which have risen a full percentage point since May, according to NAFCU Staff Economist Doug Christman.
In July, new-home sales decreased by 13.4 percent from 455,000 annualized units in June to 394,000 annualized units in July. However, new-home sales are up 6.8 percent from a year ago.
All four regions of the U.S. showed sales decreases in July. Monthly sales in the West region fell 16.1 percent, followed by:
- the South (-13.4 percent),
- the Midwest (-12.9 percent), and
- the Northeast (-5.7 percent).
Months of available inventory were 5.2 months of supply in July, which was an increase compared to a revised 4.3 months of supply in June. The number of unsold homes left on the market increased to 171,000 units; up 20.4 percent from a year ago.
The median new-home price, non-seasonally adjusted, decreased from $258,500 in June to $257,200 in July according to the U.S. Census; up from $237,400 a year ago.
“While rising mortgage interest rates and housing prices are starting to inhibit demand, the housing market is expected to continue to support the broader economic recovery throughout the year,” Christman said in a NAFCU Macro Data Flash report.
Additional data published in the FHFA’s House Price Index, a measure that tracks single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac, indicated that house prices rose 0.7 percent in June on the seasonally adjusted monthly index. House prices also rose 2.1 percent in the second quarter, marking the eighth consecutive quarterly price increase in the purchase-only seasonally adjusted index.