New-Home Sales Drop in August
Despite dropping mortgage rates, sales of newly built homes remained stagnant in August. According to real estate market platform Zillow, there were 716,000 new-home sales in August, down by 4.7% from the 751,000 sales recorded in July. However, sales were still 9.8% above the U.S. Census Bureau's August 2023 estimate. Additionally, there were 467,000 new homes available for sale at the end of August, a 7.8-month supply, up from 7.3 months in July but slightly below the 7.9-month supply in August 2023.
Although home buying activity tends to decline this time of year, the slowdown in new home sales could be short-lived since the latest survey data from the National Association of Home Builders showed an increase in builder confidence, coupled with a decline in the share of builders cutting their prices or offering incentives. The average price reduction also fell for the first time since July 2022.