Sales of new single-family houses during January were at a seasonally adjusted annual rate of 657,000, according to estimates published by the US Census Bureau and the Department of Housing and Urban Development.
January’s sales activity was 10.5% below the revised December rate of 734,000 and was also 1.1% below the January 2024 estimate of 664,000.
The median sales price of new houses sold last month was $446,300 while the average sales price was $510,000. The seasonally adjusted estimate of new houses for sale at the end of January was 495,000, which represents a nine-month supply at the current sales rate.
First American Deputy Chief Economist Odeta Kushi quipped that new home sales “started the year more like a lamb than a lion” while noting the median sales price increased to the highest level since 2022.
“On the positive side, the new home market has become less sensitive to changes in interest rates thanks to homebuilders’ ability to offer rate buydowns and other pricing incentives,” Kushi added. “However, this is threatened by elevated financing costs. Incentive use may be declining as a sales strategy as elevated interest rates reduce the pool of eligible home buyers.”
Dr. Anthony B. Sanders, chief economist at Artesia Economics, noted in his Confounded Interest blog that last month’s data was a testament to the previous administration’s handling of the economy.
“High housing prices, high commodity prices, high interest rates,” Sanders wrote. “All thanks to Biden’s horrible top-down economic policies. It’s as if Biden was humming ‘I’m going to take prices higher’ while he was President.”
