New sales of housing increases unexpectedly despite high rates of mortgages, as builders reduce prices

Sales of new American single-family homes increased to more than three years in April, as builders reduced prices to attract buyers, but increasing mortgage rates and economic uncertainty remained heads for the housing market.

The February and March data was significantly reviewed, achieving some of the brightness of the unexpected increase in sales last month, reported by the Commerce Department on Friday.

“The strength in new housing sales does not change our opinion that housing activity is being further weakened in the second quarter and is likely to remain soft this year,” said Veronica Clark, a Citigroup economist. “Still high rates and a slowdown labor market will further weigh the demand for homes.”

The new housing sales increased by 10.9% to a seasonally adjusted annual rate of 743,000 units last month, the Census Office of the Department of Commerce said on Friday.

The March sales rate was reviewed to a rate of 670,000 units of the 724,000 units reported, while in February it was reduced to 653,000 units of 674,000 units.

The economists responded by Reuters provided for new housing sales, representing about 15.7% of North -American housing sales, decreasing to a rate of 693,000 units. The new sales of housing, which are counted on the signing of a contract, are volatile from month to month and are subject to great reviews.

They advanced 3.3% year after year in April. Sales last month decreased 14.8% in the north -East. However, they jumped by 35.5% to the Midwest and increased by 11.7% to the densely populated south. Sales increased by 3.3% in the West.

The highest mortgage rates and the non -configured economic prospects in the midst of the aggressive trade policy of President Trump and the massive features of public workers have left buyers, leaving builders to reduce prices and offer incentives to relieve some of the higher buyers of loans.

Builders that reduce prices

The average median house price dropped from 2.0% to $ 407,200 in April from a year earlier. Prices could be further moderated, as the National Association of Housing Builders reported last week that the builder’s share that reduced prices in May was the highest by almost 1-1/2 years.

Most of the houses sold in April were in the price range of 300,000 to $ 39999. Most houses were completed or under construction.

“Builder’s incentives, including price reductions, can support sales, but we think that it will be overcome by weaker economic growth and increasing mortgage rates, which close 7%,” said Nancy Vanden Huten, an American economist in Oxford Economics.

The rate of the popular 30 -year -old fixed mortgage was average of 6.86% this week, which showed the data of the Freddie Mac mortgage finance agency.

Mortgage rates have increased in conjunction with the tenor of the U.S. Treasury of ten years on concerns about Trump Administration’s policies and the deterioration of the nation’s tax perspectives after the Moody Investor Service cut off its highest level of sovereign credit.

The Chamber on Thursday approved Trump’s “big and beautiful bill”, which the estimated non -partisan budget budgets would add about $ 3.8 to $ 36.2 trillion debt to the federal government in the next decade, if it becomes a law.

The inventory of new houses last month reduced 0.6% to 504,000 units, leaving near levels at the end of 2007. Houses under construction constituted most of the inventory. At the sales rate of April, it would take 8.1 months to erase the supply of new houses to the market, dropping down from 9.1 months in March.

With the supply of previously owned houses now the highest in more than four years, the prospects of the new construction are faint.

“The start of the house has already declined, suggesting that the availability of new constructions will fade from here,” said Ben Ayers, a senior economist from all over the country. “In addition, the accumulation of existing houses for sale should displace some demand from the new domestic market during 2025.”