New Home Sales Rise 1.5% in June Amid Price Drops

Sales of newly constructed homes rose 1.5% in June to a seasonally adjusted annual rate of 628,000, according to data released by the U.S. Census Bureau and Department of Housing and Urban Development. This increase follows a 7.3% monthly decline in May. The median sales price for new homes dropped to $398,000 in June, a 3.3% decrease from May's median price of $412,000 and a 2.7% decrease compared to June 2025. Despite the overall uptick, sales in the West region experienced a significant decline, falling 22.4% month-over-month and 24.6% year-over-year.

The housing market has been contending with elevated mortgage rates and inflationary pressures. The average 30-year fixed mortgage rate stood at 6.49% in June, as reported by Freddie Mac, marking the highest monthly average since August 2025. Mortgage rates have continued to ascend through most of July. Realtor.com economist Joel Berner noted that while the first half of the year presented challenges for the housing market, these impacts varied across different regions. He stated that builders are navigating rising costs, increased competition from the existing home market, and declining buyer confidence.

Regional performance showed variations, with the Midwest emerging as a strong area for affordability. Sales in the Midwest for the first half of the year were approximately 2.5% higher than in 2025. This region benefits from generally more constrained housing supply, leading to better sales performance for new homes. The data provides a current snapshot of the housing market's condition and consumer willingness to purchase new properties.