By NAHB
Expectations of the Federal Reserve beginning the first in a series of rate reductions kept potential home buyers in a holding pattern in August.
Sales of newly built, single-family homes in August fell 4.7% after an unusually strong July, according to newly released data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. August new home sales registered a 716,000 seasonally adjusted annual rate, after an upwardly revised estimate of 751,000 for July. Despite the slip in August, the three-month moving average for new home sales is at its highest level since March of 2022. New home sales are up 4% on a year-to-date basis through August.
“Builder sentiment and future sales expectations are improving as the Federal Reserve begins a credit easing cycle,” said Carl Harris, chairman of the National Association of Home Builders (NAHB) and a custom home builder from Wichita, Kan. “However, due to the mortgage interest lock-in effect, declining interest rates will mean rising existing home inventories and some additional new competition for home builders.”
