T
he National Association of Home Builders (NAHB) reports that rising mortgage rates and affordability challenges led to a decline in new home sales in October 2024. According to data from the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau, newly built single-family homes sold at a seasonally adjusted annual rate of 610,000 units, down 17.3% from September and 9.4% from October last year.

    NAHB Chairman Carl Harris noted that the decline in new home sales reflects the challenges faced by prospective buyers dealing with tighter budgets and higher borrowing costs. Assistant Vice President Danushka Nanayakkara-Skillington added that higher mortgage rates, which rose 60 basis points in October, combined with elevated home prices, continue to exacerbate affordability challenges.

    The inventory of new single-family homes remained high at 481,000 units, an 8.8% increase from a year earlier, representing a 9.5-month supply at the current sales pace. The median price for a new home in October rose 2.5% to $437,300, a 4.7% increase compared to a year ago.

    Regionally, new home sales trends were mixed, with sales rising by 35.3% in the Northeast and 15.9% in the Midwest, but falling 19.7% in the South and 1.3% in the West.