WASHINGTON, D.C. — Sales of new single-family homes fell in July 2025, continuing a trend of slowing demand amid elevated mortgage rates and shifting market dynamics, according to new data released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development (HUD).
New home sales were recorded at a seasonally adjusted annual rate of 652,000 units, a decline of 0.6% from June’s revised rate of 656,000 and 8.2% lower than the 710,000 pace observed in July 2024. The figures highlight ongoing challenges in the housing market as affordability pressures persist.
Inventory Levels Edge Higher
The number of new single-family homes available for sale at the end of July stood at an estimated 499,000 units, representing a modest 0.6% decrease from June’s 502,000 but a 7.3% increase compared to the same period last year.
At the current sales pace, this inventory equates to a 9.2-month supply, unchanged from June but up significantly from 7.9 months in July 2024. The elevated supply relative to sales suggests that builders are navigating a more cautious demand environment despite expanding overall inventory levels compared to last year.
Median and Average Prices Continue to Decline
Price pressures in the new home market eased further in July. The median sales price of new homes dropped to $403,800, down 0.8% from June and 5.9% lower than July 2024’s median of $429,000.
The average sales price declined more sharply, falling 3.6% month over month to $487,300. Compared to the same period last year, average prices were down 5.0% from $513,200.
Market Outlook
The July report spotlights a continued cooling in the housing sector as higher borrowing costs weigh on affordability and temper buyer demand. While inventory levels are rising year-over-year, they remain relatively flat month-to-month, suggesting builders are balancing new construction activity against slower sales momentum.
Analysts will be watching closely to see whether falling prices provide enough incentive to spur renewed demand in the months ahead or if persistent affordability challenges continue to dampen the pace of new home sales into the fall.
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