New-home sales continue slide in April; Q1 sales revised down

Existing-home sales disappointed in April, and new-home sales followed suit, falling 5.9% monthly to a seasonally adjusted annual rate of 863,000, according to estimates from the U.S. Census Bureau and the Department of Housing and Urban Development (HUD).

Sales were also revised downward for two of the previous three months, including a big subtraction to March’s numbers. The Census and HUD had originally reported a pace of 1.021 million units in March, a figure that was revised to 917,000 units upon further review.

The new revisions put average new-home sales for the first quarter at a seasonally adjusted annual rate of 921,000 units, down from 959,000 pre-revisions.

Surging prices — both on the homebuying side and the material supply side — appear to be part of the reason that home sales are getting held back, per Chuck Fowke, chair of the National Association of Home Builders (NAHB).

“Affordability factors are clearly affecting new home sales,” said Fowke. “A growing number of builders are limiting sales in order to manage supply chains, including access and cost factors associated with lumber, appliances, and other building materials. Policymakers need to find ways to improve the supply-chain, by facilitating more domestic production, or in cases where that cannot be done, suspending tariffs to allow for more imports.”

The median sale price of new homes sold in April was $372,400, up substantially from last April, NAHB chief economist Robert Dietz observed.

“After a period of builders holding back price increases, new home prices were 20% higher year-over-year per the April Census data,” said NAHB Chief Economist Robert Dietz. “Higher costs have priced out buyers, particularly at the lower end of the market. A year ago, 45 percent of new home sales were priced below $300,000. In April 2021, only 27 percent of new home sales were priced below $300,000.”

Low inventory has helped drive price upward, with April’s seasonally adjusted estimate of new houses for sale at 316,000, 33.3% lower than April 2020. That represents a supply of 4.4 months at the current sales rate.


More Headlines