US New Home Sales Dip 0.6% in September as Rising Mortgage Rates Weigh on Demand

Sales of new US single-family homes fell 0.6% in September to a seasonally adjusted annualized rate of 676,000 units, the Commerce Department's Census Bureau said Tuesday, partially reversing the prior month's gain. August data was revised down to 680,000 from 684,000. Economists polled by Reuters had forecast a steeper decline to 650,000. Sales dropped 5.3% year-over-year. The average 30-year fixed mortgage rate has climbed more than 130 basis points since the US and Israel attacked Iran at the end of February, averaging 7.32% last week, Freddie Mac data showed. Higher rates have deepened an affordability crisis dominating campaign messaging ahead of next Tuesday's midterm elections. The median new house price fell 3.9% from a year earlier to $400,400, reflecting weak demand and developer price cuts. Inventory slipped to 476,000 units, an 8.4-month supply. A National Association of Home Builders survey showed sales expectations over the next six months at their lowest since April 2012, excluding the pandemic's early plunge.