New-home
sales
cooled
in
April
as
the
supply
of
existing
homes
increased
and
demand
was
hampered
by
high
mortgage
rates. 

New-home
sales
reached
a
seasonally
adjusted
annual
rate
of
634,000
in
April,
according
to

data
published
Thursday
by
the


U.S.
Census
Bureau
and
the

U.S.
Department
of
Housing
and
Urban
Development
(HUD).
This
figure
represents
a
4.7%
decline
from
the
revised
March
rate
of
665,000,
and
it
also
marks
a
7.7%
pullback
from
the
April
2023
estimate
of
687,000
units.

“As
the
inventory
of
existing
homes
has
increased,
homebuyers
have
choices
and
demand
for
new
construction
has
cooled
slightly,”

Bright
MLS
chief
economist
Lisa
Sturtevant
said
in
a
statement.
“We
can
also
see
the
inventory
of
unsold
new
construction
also
building
up.
At
the
end
of
April,
the
new
home
inventory
was
12.1%
higher
than
a
year
ago,
the
biggest
year-over-year
supply
gain
since
December
2022.

“At
the
same
time
that
supply
is
starting
to
increase,
demand
is
being
challenged
by
7%
mortgage
rates
and
affordability
ceilings.
Homebuilders
have
been
offering
concessions
and
building
smaller
homes
in
response
to
the
tight
conditions
some
homebuyers
are
facing.”

Homebuilder
sentiment
stalled
in
May
on
the
back
of
elevated

mortgage
rates.
In
May,
25%
of
builders
cut
prices,
up
from
22%
in
April,
according
to
the

National
Association
of
Home
Builders
(NAHB).
But
the
average
price
reduction
in
May
held
steady
at
6%
for
the
11th
straight
month
and
the
use
of
sales
incentives
rose
to
59%
in
May,
up
from
57%
in
April.

At
the
end
of
April,
there
were
480,000
new
homes
available
for
sale.
At
the
current
sales
pace,
there
is
a
9.1-month
supply
of
new
single-family
homes,
according
to
census
and
HUD
data. 

The
median
sale
price
for
a
new
home
rose
to
$433,500
in
April.
Meanwhile,
the
median
price
of
an

existing
home
sold
last
month
was
$407,600. 

“New
home
sales
are
vitally
important
considering
the
continued
shortage
of
homes
in
most
markets
and
will
continue
to
gradually
increase
with
solid
economic
background
and
availability
constraints
in
the
existing
market,”

CoreLogic
chief
economist
Selma
Hepp
said
in
a
statement.
“Also,
the
growth
in
new
homes
continues
to
be
abetted
by
builders’
ability
to
offset
falling
housing
affordability
through
price
discounts,
mortgage
rate
buy-downs,
and
similar
incentives,
which
will
keep
the
overall
share
of
new
home
sales
elevated.”

As
of
May
17,
there
were
578,000
single-family
homes
unsold
on
the
market,
up
1.7%
for
the
week
and
36%
higher
than
one
year
ago,
according
to


Altos
Research.
Additionally,
price
cuts
are
on
the
rise
nationally
as
34.4%
of
the
homes
on
the
market
last
week
included
a
price
cut,
up
70
basis
points
from
the
week
prior.
Last
year
at
this
time,
29.9%
of
the
homes
on
the
market
included
price
cuts. 

As
of
this
week,
every
state
has
more
inventory
than
a
year
ago,
Altos
Research
reported.
Even
New
York
and

Nevada,
which
were
the
last
holdouts
in
terms
of
inventory
growth,
are
now
both
in
positive
territory. 

Meanwhile,

single‐family
housing
starts
in
April
fell
to
a
seasonally
adjusted
annual
rate
of
1.031
million
units,
0.4%
below
the
revised
March
figure
of
1.035
million.
The
overall
growth
in
housing
starts
last
month
was
driven
by
the

multifamily
sector,
where
the
yearly
pace
ticked
up
to
322,000
units.
But
new
multifamily
starts
also
continue
to
track
far
below
year-ago
levels,
according
to
Sturtevant. 

Related