Washington, D.C.—New home sales improved in August, but the monthly gain masks continued weakness in the broader new-home market, according to the National Association of Home Builders (NAHB). Elevated mortgage rates and ongoing affordability challenges continue to constrain demand. Sales remain below last year’s pace and year-to-date sales trail 2025 levels.
Sales of newly built single-family homes increased 6.4% in August to a seasonally adjusted annual rate of 684,000. The U.S. Department of Housing and Urban Development and U.S. Census Bureau reported the latest figures following an upwardly revised July estimate.
The pace of new home sales was 2% lower than a year earlier. “The gain in new home sales is encouraging, but affordability remains a challenge,” said Bill Owens, chairman of the NAHB and a home builder and remodeler from Worthington, Ohio. “Sales are still down year over year and year to date and builders continue to use incentives and pricing adjustments to support buyers as limited existing-home inventory helps sustain the new-home market.”
A new home sale occurs when a buyer signs a sales contract or submits a deposit. The home can be at any stage of construction, including not yet started, under construction or completed.
“While the monthly increase in sales is a positive development, housing demand remains sensitive to higher mortgage rates and broader macroeconomic conditions,” said Danushka Nanayakkara-Skillington, NAHB assistant vice president for forecasting and analysis. “A sustained improvement in affordability, particularly through lower financing costs, would provide a stronger foundation for housing demand going forward.”
The August reading of 684,000 units also accounts for seasonal effects. The figure represents the number of homes that would sell if the August pace continued for 12 months.
New single-family home inventory remained unchanged from July at 483,000 units. Inventory fell 2% from a year ago.
That represents an elevated 8.5 months’ supply at the current sales pace. Completed, ready-to-occupy inventory totaled 112,000 homes in August.
The combined inventory of resale and new homes represented a 5.3-month supply at the current sales pace.
The median new home sales price increased 0.4% from July to $393,700. The median price fell 5.8% from a year ago.
On a year-to-date basis, new home sales fell 0.6% in the Midwest, 1% in the South and 10% in the West. Sales remained unchanged in the Northeast.