U.S. New Home Sales Tumble 12.4% in April, Crushing Estimates

Sales of new U.S. single-family homes plummeted 12.4% to a seasonally adjusted annual rate of 588,000 units in April, the Commerce Department reported Thursday, far below the 670,000 consensus estimate and the sharpest monthly drop in more than a year. The unexpected free fall underscores how persistently high mortgage rates are gutting buyer affordability during the crucial spring selling season. The average rate on a 30-year fixed mortgage has hovered above 6.8% since early March, according to Freddie Mac, while the Federal Reserve has signaled no imminent rate cuts. Inventories of new homes swelled to an 8.5-month supply at the current sales pace, the highest since late 2025, piling pressure on builders to offer discounts and incentives. The housing market headwinds are likely to dampen broader economic momentum in the second quarter.