New home sales fall to 676,000 units in September

New home sales across the United States dropped to 676,000 units in September, marking a 0.6% decline from the previous month. The U.S. Census Bureau released these figures on Tuesday, citing high mortgage rates and a tight housing market driven by economic uncertainty from the Middle East conflict.

Mortgage costs have risen sharply since the start of the conflict between the United States and Iran in late February. Freddie Mac data shows the average 30-year fixed mortgage rate reached 7.32%, an increase of more than 100 basis points from that time. This sustained increase in borrowing costs continues to pressure potential buyers.

Year-over-year comparisons show a steeper drop, with new home sales falling 5.3% in September compared to the same month last year. The average price of a new home decreased by 3.9% last month, bringing the cost for most consumers to approximately $400,000. Despite this price reduction, housing affordability remains a persistent challenge for buyers.

Inventory levels also contracted during the reporting period. New home inventory fell to 476,000 units in September. Industry analysts point to a slowdown in construction activity over recent months as a primary driver for this drop. High material costs and a shortage of construction workers have kept the pace of new builds lower than previous levels.

The data reflects a market where rising borrowing costs and limited supply continue to shape buyer behavior. The Census Bureau’s report provides the latest snapshot of this trend, showing that even with lower home prices, the volume of new sales remains under pressure.