Sales of new U.S. single-family homes fell to a two-year low in April, as mortgage rates increased and prices hit record levels in many areas.
The fourth straight monthly decline in sales was reported by the Commerce Department after stats released last week showed a significant drop in single-family building permits in April.
New home sales plunged 16.6% to a seasonally adjusted annual rate of 591,000 units last month, the lowest level since April 2020. March’s sales pace was revised down to 709,000 units from the previously reported 763,000 units. Sales dropped 5.9% in the Northeast, 15.1% in the Midwest, 19.8% in the densely populated South ad 13.8% in the West.
Economists polled by Reuters had forecast that new home sales, which account for 9.5% of U.S. home sales, would fall to a rate of 750,000 units. Sales dropped 26.9% on a year-on-year basis in April. They peaked at a rate of 993,000 units in January 2021, which was the highest level since the end of 2006.