2025-08-26
U.S. New Home Sales Slightly Decline in July, Prices Hit Near One-Year Low
According to data released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development on August 25, 2025, the seasonally adjusted annual rate of single-family new home sales in July 2025 stood at 652,000 units, a slight 0.6% decrease from June. Despite the minor decline, this figure exceeded market expectations of 630,000 units. Year-over-year sales dropped 8.2%, marking the lowest level since October 2024 and recording the seventh consecutive month of negative growth — the longest slump in nearly three years.
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The median sales price of new homes reached $403,800, down 5.9% from July 2024, the lowest since November 2024. According to the National Association of REALTORS® (NAR), the median price for existing homes in July was $422,400, indicating continued price declines across the housing market.
Inventory of single-family homes for sale decreased from 502,000 units at the end of June to 499,000 units, the lowest since February, with months of supply steady at 9.2, down from 9.6 months in late May.
Regionally, new home sales rose 11.7% month-over-month in the West, while sales declined 6.6% and 3.5% in the Midwest and South respectively, and remained unchanged in the Northeast.
New single-family home starts were at an annual rate of 621,000 units, down 1.0% month-over-month and down 3.7% year-over-year, reflecting ongoing weakness.
Overall, builders have lowered home prices to attract buyers. However, high mortgage rates continue to limit the growth momentum, keeping overall sales below historical levels for the period. Mortgage rates remained high at around 6.58% in mid-August, about 0.1 percentage point above last year's level, dampening buyer demand. Experts suggest that a drop in mortgage rates below 6% would effectively stimulate demand, especially among first-time and move-up buyers, potentially leading to a market recovery. Despite short-term pressures, promotional incentives and expectations of easing rates may support a steady rebound in the new home market.
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