Sales of new U.S. single-family homes fell to the lowest level in nearly two years in October, possibly as a increase in mortgage rates Buyers were sidelined and the storm disrupted activity.
The Commerce Department’s Census Bureau said Tuesday that new home sales fell 17.3% last month to a seasonally adjusted annual rate of 610,000 units, the lowest level since December 2022.
Sales pace for September was unchanged at a rate of 738,000 units.
Economists polled by Reuters had forecast that new home sales, which account for about 15% of U.S. home sales, would slow to a pace of 725,000 units.
New home sales are calculated at the time the contract is signed, and can fluctuate on a month-to-month basis.
They declined 9.4% year-on-year in October.
Mortgage rates have reversed all the decline that pushed them to a 1-1/2 year low of more than 6.08% in late September. Federal Reserve started cutting interest rates,
The average rate on a 30-year fixed-rate mortgage rose to 6.72% by the end of October, leading 10-year Treasury yields to rise on strong domestic data that suggested a slower path to rate cuts. Central bank.
Less rate cut expected This has also been strengthened by the fear of inflation increasing again next year.
President-elect Donald Trump said on Monday that he would implement a 25% tariff on all products from Mexico and CanadaAnd imposed an additional 10% tariff on goods coming from China on his first day in office.
Last week the average for a 30-year fixed rate mortgage was 6.84%.
Sales of new homes in the densely populated South fell 27.7%, likely due to the storm disrupting activity. They fell 9.0% in the West, but rose 1.4% in the Midwest and increased 53.3% in the Northeast.
The median price of a new home rose 4.7% in October to $437,300 from a year earlier. Inventories of new homes rose to 481,000 from 471,000 units in September, the highest level since early 2008.
At October’s sales pace it will take 9.5 months to replenish the supply of homes on the market, up from 7.7 months in September.
