Despite Higher Mortgage Rates, New Home Sales Post Solid Gain in March

By Robert Dietz
NAHB – Eye on Housing
April 23, 2024
Category: Finance & Economics
Region: United States

Despite higher interest rates last month, new home sales rose in March due to limited inventory of existing homes. However, the pace of new home sales will be under pressure in April as mortgage rates moved above 7% this month, which is expected to moderate sales and increase the use of builder sales incentives this Spring. Sales of newly built, single-family homes in March rose 8.8% to a 693,000 seasonally adjusted annual rate from a downwardly revised reading in February, according to newly released data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The pace of new home sales in March is up 8.3% from a year earlier. Although consumer demand has been somewhat dampened due to higher interest rates, builders continue to supply new homes to the market to lift inventory to make up for the low resale supply.

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