New Home Market Remains Stuck in Neutral

The latest New Home Sales report showed little change in July, with sales holding very close to June’s pace. The seasonally-adjusted annual sales rate came in at 652,000. This marks a -0.6% dip from June’s revised 656,000, and leaves sales -8.2% lower than July 2024’s 710,000 level. For all practical purposes, the pace of sales continues to run sideways, reflecting the same stable range seen over the past 2+ years despite periodic swings. Regional Breakdown (Sales, July 2025) South: -3.5% MoM Midwest: -6.6% MoM Northeast: unchanged MoM West: +11.7% MoM Market Inventory & Pricing Homes for sale: 499,000 units (-0.6% from June; +7.3% YoY) Months’ supply: 9.2 months (flat MoM; +16.5% YoY) Median sales price: $403,800 (-0.8% MoM; -5.9% YoY) Average sales price: $487,300 (-3.6% MoM; -5.0% YoY) Big Picture Takeaway July’s new home sales data reinforces the recent pattern: demand is steady at best, but not accelerating. Inventory remains elevated, keeping months’ supply near multi-year highs. While prices have softened meaningfully versus last year (reflecting lower square footage more than actual price declines), elevated housing costs continue to limit the benefit to buyers.