By NAHB
Home buyers moved off the sidelines in September following the Federal Reserve’s recent move to cut interest rates for the first time in four years.
Sales of newly built, single-family homes in September increased 4.1% to a 738,000 seasonally adjusted annual rate from a downwardly revised August number, according to newly released data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The pace of new home sales in September is up 6.3% compared to a year earlier.
“Despite challenging affordability conditions, home builder confidence edged higher in October as they anticipate that mortgage rates will gradually, in an uneven manner, moderate in the coming months,” said Carl Harris, chairman of the National Association of Home Builders (NAHB) and a custom home builder from Wichita, Kan. “There is a significant need for additional housing supply, as many prospective home buyers are entering the market.”
“Following the Fed’s actions in September, mortgage rates fell to 6.18%, from 6.5% in August,” said Jing Fu, director of forecasting and analysis for NAHB. “However, new home sales will likely weaken in October due to a recent rise in long-term rates.”
