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Sales of newly constructed single-family homes enjoyed a healthy boost in March 2024 after an unexpected decline the month before.
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Sales of newly built single-family homes hit a seasonally adjusted annual rate of 693,000 in March 2024, 8.8 percent above the revised February 2024 rate of 637,000 and 8.3 percent above the March 2023 rate of 640,000, the U.S. Census Bureau and Department of Housing and Urban Development announced.
Limited resale inventory has continued to drive homebuyers to new construction, as well as homebuilders’ willingness to provide incentives to keep their inventory moving, Gregg Logan of RCLCO Real Estate Consulting said in a statement emailed to Inman.
Gregg Logan | RCLCO
“Despite high prices and mortgage rates, homebuyers have limited options on the resale market, although resale inventories have improved some over the course of this year,” Logan said. “The willingness of the major homebuilders to utilize incentives such as price reductions, mortgage rate buy-downs and paying buyers closing costs continue to support a healthy pace of new home sales.”
The median sales price of new homes sold during March 2024 was $430,700 while the average sales prices was $524,800.
Logan also noted that some homebuilders have added a greater mix of smaller homes into their portfolios in order to make prices more affordable to homebuyers as they continue to deal with higher home prices and mortgage rates on the whole.
The average rate on a 30-year, fixed-rate mortgage was 7.43 percent on Monday, according to Mortgage News Daily.
As of the end of March 2024, the seasonally adjusted estimate of new homes for sale was 477,000, or a supply of 8.3 months at the current sales rate.
Robert Frick | Navy Federal Credit Union
Robert Frick, corporate economist with Navy Federal Credit Union, said that although the March figures from the Census Bureau were a good sign, much more inventory is still needed across the country.
“The jump in sales is welcome, but the country remains more than 4 million homes below what’s needed for the number of American families today,” Frick said in a statement emailed to Inman. “We’ll need to see lower mortgage rates to spur much more building to make up that deficit.”
