Elevated mortgage rates, higher inflation and economic uncertainty kept more buyers on the sidelines in April as ongoing affordability challenges continue.
Sales of newly built single-family homes fell 6.2% in April to a seasonally adjusted annual rate of 622,000, according to newly released data from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The pace of new home sales is down 11.3% from a year earlier.
“Although there are still signs of demand, many potential buyers are stepping back because of higher mortgage rates and gas prices,” said Bill Owens, chairman of the National Association of Home Builders (NAHB) and a home builder and remodeler from Worthington, Ohio. “Builders continue to offer a range of sales incentives, but home sales have declined this year because income growth is not keeping pace with housing costs.”
“New home sales are on track to decline in 2026 as mortgage rates are expected to remain elevated in the months ahead,” said NAHB Chief Economist Robert Dietz. “The Midwest remains a bright spot, with sales up 7.3% year to date, compared with declines in the rest of the country.”
A new home sale occurs when a sales contract is signed, or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the April reading of 622,000 units is the number of homes that would sell if this pace continued for the next 12 months.
New single-family home inventory in April rose to 489,000 units, up 1.7% compared to the previous month. This represents an elevated 9.4 months’ supply at the current building pace.
The median new home sale price was $422,500, up 8.0% from March and up 2.2% from a year ago. Completed, ready-to-occupy inventory accounted for 122,000 homes in April, up 6.1% from a year ago.
Regionally, on a year-to-date basis, new home sales are up 7.3% in the Midwest. New home sales are down 9.7% in the Northeast, 7.6% in the South and 9.5% in the West.