According to the Department of Commerce, new-home sales in January were down to a seasonally adjusted annual rate of 607,000.
Annually, sales of new homes were down 4.1 percent, and over December 2018, these sales fell 6.9 percent. Realtor.com reports that the current sales pace had a 6.6 month supply of new homes on the market by the end of January, an uptick from December's 6.3 month supply. Existing-home sales were down 1.2 percent month-over-month, and 2018 was had the softest home sales since 2015.
Higher mortgage rates and a run-up in prices put a dent in home purchases in 2018. The average rate on a 30-year, fixed-rate mortgage rose about 1 percentage point to nearly 5 percent from the start of 2018 to last November, according to Freddie Mac. Since then, borrowing costs have dropped, hitting a low of 4.35 percent at the end of February before inching up again last week.
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