WASHINGTON, Sept 24 : Sales of new US homes beat analysts’ expectations in August to reach the fastest pace since early 2022, government data showed Wednesday, as mortgage rates pulled back and builders offered incentives to lure buyers.
New home sales surged 20.5 percent from the prior month to a seasonally adjusted annual rate of 800,000, according to Department of Commerce data.
This was comfortably above the 650,000 level expected by a Briefing.com consensus forecast.
Affordability has bogged down property sales in the world’s biggest economy in recent years, with the popular 30-year fixed-rate mortgage hovering at higher levels than before.
In August, the rate stood at around 6.6 percent, pulling back from about 6.7 percent in July.
“Buyers are responding to lower mortgage rates and incentives from builders,” said Navy Federal Credit Union chief economist Heather Long.
They “are seeing a lot of value in new homes and taking advantage of the unusually high glut of new homes for sale on the market,” she added in a note.
But the median price of new houses sold was $413,500, still up 4.7 percent from the July level.
Long said many Americans remain on the sidelines, waiting for cost pressures to ease.
Last week, the US central bank made its first interest rate cut of 2025, reducing the benchmark lending rate by 25 basis points and signaling further reductions this year.
“Homebuilders have been offering price cuts and other incentives to encourage sales,” said Nancy Vanden Houten, lead economist at Oxford Economics.
But, she warned, “there are signs some builders are going to cut back on those incentives as profit margins have been squeezed.”
Analysts have cautioned that new home sales are volatile, accounting for a small size of the overall market.
