New home sales fell significantly and unexpectedly in February.
U.S. new-home sales declined by two percent to an annual rate of 772,000 in February, the Commerce Department said Wednesday. Compared to a year earlier, sales were down more than percent.
Despite higher mortgage rates, new home sales had appeared to be holding up. Economists had expected sales to climb to 810,000 from the initially reported 801.000 for January. Instead, January’s figure was revised down to 788,000.
Compared with expectations, sales were off by 4.6 percent.
The supply of new homes for sale rose between January and February to a 6.3-month supply of units, that is the longest supply since 2008.
The average sales price for a new home was $511,000 and the median price was $400,600.
The share of homes priced at the top of the market has grown tremendously. A year ago, new homes priced over $500,000 accounted for 23 percent of sales. In February of 2022, homes priced over a half a million dollars made up 33 percent of sales.