New home sales fall in defiance of other signs of warming housing market

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JUST IN: New home sales fall in defiance of other signs of warming housing market

New home sales in June fell 2.5% to a seasonally adjusted annual rate of 697,000, according to a report Tuesday from the Census Bureau. The reading comes amid persistently higher mortgage rates, which are dampening the market to some extent. Still, though, sales were 23.8% higher than in June 2022.Mortgage rates are much higher now than they were a year ago because the Federal Reserve has been hiking rates consistently since March 2022.

The previous new home sales report was a surprise for economists. It showed sales in May rose 12.2%, far above the number expected by forecasters. That is due in part to the strange dynamics of the housing market right now, which is showing relative strength even despite the soaring mortgage rates. Existing home sales fell by 3.3% in June to a seasonally adjusted annual rate of 4.16 million, according to a report by the National Association of Realtors released last week.

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