Sales of new single-family houses in August were at a seasonally adjusted annual rate of 800,000, a 20.5% surge from the July rate of 664,000 and a 15.4% rise above the August 2024 rate of 693,000.
According to estimates released by the US Census Bureau and the Department of Housing and Urban Development, the seasonally adjusted estimate of new houses for sale at the end of August was 490,000, which is 1.4% below the July estimate of 497,000 and 4% above the August 2024 estimate of 471,000. This represents a supply of 7.4 months at the current sales rate.
The months’ supply is 17.8% below the July estimate of nine months and is 9.8 below the August 2024 estimate of 8.2 months.
The median sales price of new houses sold last month was $413,500, which is 4.7% above the July price of $395,100 and 1.9% above the August 2024 price of $405,800. The average sales price of new houses sold in August was $534,100, which is 11.7% above the July price of $478,200 and 12.3% above the August 2024 price of $475,600.
Industry response to the news was laced with cautious optimism. First American Deputy Chief Economist Odeta Kushi observed, “Lower mortgage rates, along with builder incentives and discounts, helped unlock demand in August as new-home sales soared to an annualized pace of 800,000 — the fastest since early 2022 and well above consensus expectations of 650,000.”
However, Kushi added, “One month does not make a trend. It’s important to consider the wide confidence intervals in the data and the fact that these figures don’t account for cancellations. Nevertheless, it’s a welcome sign of buyer life and positive progress in a still-challenging market.”
Jing Fu, senior director of forecasting and analysis at the National Association of Home Builders, opined, “According to Freddie Mac, the average 30-year fixed mortgage rate has declined by 32 basis points over the past four weeks and now sits at 6.26%—its lowest level since early October 2024. This downward trend in rates, combined with the recent Fed interest rate cut, signals a positive outlook for future housing demand. If this momentum continues, we expect new home sales to gain traction as more buyers reenter the market in the final quarter of 2025.”
Sonali Basak, chief investment strategist for iCapital, commented on X, “Interesting to see this fresh rebound in NEW home sales – given mortgage rates have remained firmly above 6%. ReFi activity has picked up given the more recent declines we’ve seen in mortgages, but new home sales more recently have been sluggish.”
