New Home Sales Decline 10.5%, But Supply Tells a Different Story

Recent data shows that new home sales fell by 10.5%, a steeper decline than expected. Meanwhile, the supply of new homes has increased from 8 months to 9 months.

However, out of the 657,000 homes counted in inventory, only 115,000 are completed, while 106,000 haven’t even started construction—and some may never be built.

This means the actual available supply has effectively decreased by 2.1 months, making the housing market even tighter than it appears.

Builders are growing cautious. With rates lingering around 7% and no clear path to lower levels, they are proceeding with caution and hedging their bets.