• There were 698,000 (SAAR) new single family home sales nationwide in December. That’s up 3.6% from the revised November rate of 674,000 and up 6.7% from the December 2023 estimate, according to the U.S. Census Bureau.
• The median price of new houses sold was $427,000, up 2.1% from a year ago.
• The seasonally-adjusted estimate of new houses for sale at the end of December was 494,000, a supply of 8.5 months at the current sales rate. This is down somewhat from 8.7 months in November but higher than the 8.2 months in December 2023.

What happened: Sales of newly-built homes increased more than expected in December due in part to a resilient demand for housing – despite a recent rise in mortgage rates. Builders saw a strong uptick in sales at the end of the year and altogether there were 683,000 new home sales in 2024, 2.6% higher than in 2023. In 2024, new home sales increased most in the Midwest where homes remain relatively more affordable.

Why it matters: Mortgage rates have a massive impact on buyers’ purchasing power, and big swings in rates are impacting affordability and sales. While existing homes sales fell to a near 30-year low in 2024, new home sales continued to increase. This is because the decline in existing home sales is partly due to rate lock – existing homeowners refusing to give up their ultra low pandemic mortgage rates.

According to Zillow data, the price per square foot of newly built single family homes was up roughly 5% year-over-year in November.

While affordability remains under pressure, builders have continued their shift toward higher-density housing while offering rate buy-downs and other incentives to make the math work for homebuyers. The latest survey data from the National Association of Home Builders showed builder confidence has continued to rebound.