New Home Sales, which measures signed contracts on new homes, declined 4.7% from July to August, though the 716K-unit pace was above forecasts and is the third highest level of the year. Plus, sales in July were revised higher to a 751K-unit pace, which is the highest level of 2024 thus far.
What’s the bottom line? The decline in mortgage rates this summer has clearly led to an increase in activity among buyers. However, more “available” supply (i.e. completed homes ready for buyers to move into) is needed to meet buyer demand. Of the 467,000 new homes available for sale at the end of August, only 105,000 were completed, with the rest either under construction or not even started yet. Also, the median home price of $420,600 marked a 2.9% drop from July, but this was not due to falling home prices, which continue to rise nationwide as noted below. The median home price represents the mid-price of sales, and since we saw a larger mix of lower-end homes sell in August, the median home price fell slightly comparatively.