Soaring mortgage rates continue to put a damper on home sales but less than expected.
Sales of new single-family homes in September fell nearly 11% from a month earlier, according to the latest report from the U.S. Census Bureau and the U.S. Department of Housing and Urban Development.
Sales in September were at a seasonally adjusted annual rate of 603,000, 10.9% below the revised August rate of 677,000, and 17.6% below the estimate of 732,000 for September 2021. The result beat economists expectations of a 15.3% drop from August.
In addition to the August estimate being revised downward, the estimates for June and July also were lowered.
Mortgage rates, however, continued to climb during September, hitting a 14-year high as they closed in on 7%.
The median sales price of new houses sold in September was $470,600, up 8% from August and up 14% from a year earlier. The median means half of the homes sold for more and half for less.
According to the report, the majority of homes sold in September were priced at more than $300,000, with the largest cohort — estimated at 30,000 homes — selling for between $500,000 and $749,000. Fewer than 500 homes sold for less than $150,000, and just 1,000 sold for between $150,000 and $199,999.
Zillow said recently that home values would need to fall nearly 25% for affordability to return to recent norms.
The seasonally‐adjusted estimate of new houses for sale at the end of September was 462,000, up just 1% from August but up 23% from a year earlier. The September estimate represents a 9.2-month supply at the current sales rate, the report states.
By region, sales rose as compared to August in the Northeast and Midwest and fell in the South and West.
Sales jumped 56% from August in the Northeast, and were up nearly 26% from a year earlier. Sales rose 4.3% from August in the Midwest, but were up 10.6% from a year earlier.
In the South, sales of new homes in September fell 20.2% from August, and were down 19.3% from a year earlier. In the West, sales dipped 0.7% from August but were down 30.4% from the same point last year.