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ew home sales declined 4.7% in August, but the real story is the growing supply of homes. According to Census Department data, new single-family house sales reached a seasonally adjusted annual rate of 716,000 in August, down from July's revised rate of 751,000 but up 9.8% from August 2023.

    The median sales price of new houses sold was $420,600, with an average price of $492,700. The supply of new homes for sale stood at 467,000, representing a 7.8-month inventory at the current sales rate.

    New home sales have been trending downward since October 2020, falling by 30.1%. However, they are up 38% from July 2022 and roughly equivalent to levels seen in March 1973. The numbers can be spun in various ways, but the key takeaway is the growing inventory of homes.

    Breaking down the supply, 96,000 homes have not yet begun construction, while 105,000 are finished and rising at a rate not seen since the Great Recession. This represents a significant builder commitment that's difficult to reverse. The total number of started or completed homes stands at 365,000, which is the highest level since October 2009.

    The supply of completed homes has reached its highest point since May 2008, and including vacant land, it's the largest since March 2008.