New Home Sales Decline Nationwide in July
The Commerce Department released the latest report on new home sales and the month-over-month numbers are down. Total new home sales in the United States fell 12.8% in July – as compared to the month before. While that might seem like a significant drop, it is worth noting that after revision to the sales reported in June, that month showed the highest growth in 12 years.
According to the article in the Daily Journal of Commerce, there were 635,000 new home sales in the United States. The sales in June topped out at 728,000, a sharp contrast. Overall in 2019, the sales of new homes have risen 4.1% – likely due to the lower mortgage rates.
Given the vast difference between the figures from July as compared to June, the housing market as a whole can be described as “uncertain” by some. However, it is worth noting that the lower mortgage rates seem to have been the push many borrowers needed to enter the market. According to Freddie Mac, the average rate on a 30-year loan declined to just 3.55% during August.
Combined, the new home sales numbers and a rebound in existing home sales (according to the National Association of Realtors) indicates that lower borrowing cost have had a positive impact on the housing industry. However, there is also the flip side: further constraints on overall inventory. It is also worth noting the Northeast experienced the largest jump in sales – but the rest of the country did not fare so well, offsetting the overall increase.Email