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ew home sales dipped in August, falling nearly 5% from July's numbers, but still outpaced last year's figures and are expected to continue performing better than existing home sales. According to the U.S. Census Bureau, new home sales reached a seasonally adjusted annual rate of 716,000 in August, down 4.7% from July but up from the 652,000 annual rate seen a year ago.

    The median price for new homes sold last month was $420,600, a 4.6% decrease from the same period last year. This drop is attributed to builder incentives aimed at addressing affordability challenges faced by buyers. Economists predict that with interest rates hovering around 6%, home builders may see increased buyer traffic this fall.

    However, it's likely that consumers' purchasing power will not increase significantly due to ongoing affordability constraints. As a result, the new-home market is expected to continue outperforming the existing-home market in the near term, thanks to builders' flexibility with rates and their ability to offer incentives.

    New home inventory reached 7.8 months in August, higher than July's numbers but still below the year's average of over 8 months. While this supply level is considered elevated under normal conditions, it's lower than existing home inventory, which stands at 4.1 months. Economists expect this measure to increase as more sellers enter the market in the coming months.