The dashed line is the sales rate for last month. Courtesy of Calculated Risk.

Sales of new single-family homes rose 5.9% month over month in November to a seasonally adjusted annual rate of 664,000, compared to an upwardly revised level of 627,000 in October, according to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.  

The consensus estimate was for an annual rate of 669,000. 

Year over year, sales were up 8.7% from the November 2023 rate of 611,000.   

“November’s rebound in new-home sales was softer than consensus expectations, partially because mortgage rates increased 38 basis points in November,” First American Deputy Chief Economist Odeta Kushi said. “Higher-for-longer mortgage rates are a headwind to both builders and buyers — increasing buyers’ monthly mortgage payment and raising financing costs for builders.  

“Nevertheless, we expect the new-home market to outperform the existing-home market in this environment. Builders have inventory they need to sell, and the ability to offer incentives to coax buyers off the sidelines.” 

The median price of a new home sold during November fell to $402,600 from $425,600 in October. Year over year, the median price was down from the $429,600 level of November 2023.         

“The drop in median sales price of new homes is partly due to a significant increase in the number of homes sold for under $300,000,” Kushi added. “In October, 13% of homes sold were in this price range, but this jumped to 25% in November, up from 17% a year ago. When more homes are sold in the lower price tier, it pulls the median price down, even if prices in other tiers remain stable.” 

Months’ supply of new homes for sale slid 3.3% to 8.9 months from 9.2 months in October but inched higher from 8.8 months a year ago.