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New home sales remain stuck in a broad range. Median and average prices decline.
 

The New Residential Construction report shows transactions floundering with year-over-year declines in price.
 

New Home Sales

• Sales of new single-family houses in July 2025 were at a seasonally-adjusted annual rate of 652,000.
• This is 0.6 percent (±15.5 percent) below the June 2025 rate of 656,000, and is 8.2 percent (±14.0 percent)below the July 2024 rate of 710,000.
• The Census Department revised June sales from 627,000 to 656,000. That’s an upward revision of 4.6 percent.

For Sale Inventory and Months’ Supply

• The seasonally-adjusted estimate of new houses for sale at the end of July 2025 was 499,000.
• This is 0.6 percent (±1.2 percent) below the June 2025 estimate of 502,000, and is 7.3 percent (±5.7 percent) above the July 2024 estimate of 465,000.
• This represents a supply of 9.2 months at the current sales rate. The months’ supply is virtually unchanged (±16.7 percent) from the June 2025 estimate of 9.2 months, and is 16.5 percent (±19.0 percent) above the July 2024 estimate of 7.9 months.

Sales Price

• The median sales price of new houses sold in July 2025 was $403,800. This is 0.8 percent (±5.9 percent) below the June 2025 price of $407,200, and is 5.9 percent (±8.5 percent) below the July 2024 price of $429,000.
• The average sales price of new houses sold in July 2025 was $487,300. This is 3.6 percent (±8.0 percent) below the June 2025 price of $505,300, and is 5.0 percent (±8.6 percent) below the July 2024 price of $513,200.

New Home Sales Annualized vs Homes for Sale Detail
 

The supply of new homes for sale is pressuring prices and incentives.
 

New Homes For Sale By Stage of Construction
 

The supply of completed homes for sale is the most since July of 2009.

I don’t consider vacant land a home for sale, but the census department does.

Of the alleged 499,000 homes for sales, 111,000 have not been started. The other numbers are historically on the high side.

New Homes for Sale Supply
 

The Census Department calculates a 9.2 month supply at the current rate of sales.

I suggest 7.1 months counting only firm commitments to build. Finished supply is high and rising.

The Fed Is Incompetent by Design

Blame the Fed for wild swings in housing affordability.

I discussed this in Fedthink! The Fed Is Incompetent by Design and Can’t Be Fixed

Today’s Pertinent Conclusion

We are trapped in “Fedthink”, especially the nonsensical proposition that two percent inflation is a good thing despite the fact that the Fed is clueless on how to measure inflation in the first place.

The Greenspan Fed, Bernanke Fed, Yellen Fed, and the Powell Fed all ignored housing prices as a measure of inflation.

Yellen even wanted to make up for lack of not enough inflation.

The Housing Top Is Likely In, Case-Shiller Home Prices Drop Again

On July 29, 2025, I commented The Housing Top Is Likely In, Case-Shiller Home Prices Drop Again

Prices are now down the third consecutive month. [But it does not even register on a chart.]

Demographically, the upcoming boomer die-off will add tremendous supply to the housing market. Shutting down the border will slow the rate of current demand.

Related Posts

August 22, 2025: Existing-Home Sales Rise 2 Percent to Nowhere, Expect Steep Price Declines

NAR-reported median prices will now decline for many months.

August 23, 2025: It’s Now Twice as Expensive to Buy an Entry-Level Home than Rent

Thinking of buying a starter home? Be careful!

Powell Admits Prior Monetary Framework Was Hugely Flawed

At the annual Jackson Hole meeting this year Powell Admits Prior Monetary Framework Was Hugely Flawed

The Fed just announced a new monetary framework. Is it any better?

The short answer is the new framework is nearly as flawed as before, and the Fed still holds many disproved economic theories. See above for details.

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