New single-family house sales in July 2026 recorded a seasonally-adjusted annual rate of 607,000 units, representing a 10.5% decline from the June 2026 rate of 678,000 units, according to the New Residential Construction Report. This marks the lowest sales pace since January 2026 and 10.5% decline year-over-year, missing market expectations of a softer decline to 620,000 units. The sales data reflects continued weakness in the housing market, with both new and existing home sales remaining stagnant since January 2023 despite significant interest rate movements. As per Reuters, new home sales, which are counted at the closing of a contract, account for a small share of U.S. home sales and tend to be volatile on a month-to-month basis.
Regional sales patterns showed significant variation across the country, with the Midwest experiencing the most severe decline at -42.7% month over month and -50.6% year over year, while the South fell sharply by 13% month over month and 5.2% year over year. The Northeast provided some relief with a 30.3% increase month over month and 95.5% increase year over year, and the West showed modest growth of 6.2% to 138,000 units. These regional disparities highlight the uneven impact of housing market conditions across different parts of the country, with the Midwest and South bearing the brunt of the downturn while the Northeast and West showed resilience. As per Realtor.com senior economist Joel Berner, "The bright spot is the Northeast," with the region experiencing its highest level of 2026 for new home sales.
The median sales price of new houses sold in July 2026 was $393,800, showing a 2.3% decrease from June 2026's price of $403,100 and a 0.9% decrease from July 2025's price of $397,300, according to the report. This represents the lowest median price in four years, highlighting the significant impact of elevated mortgage rates on housing affordability. The average sales price increased to $508,800 in July 2026, representing a 4.1% increase from June 2026's price of $488,900 and a 5.4% increase from July 2025's price of $482,800. Notably, new-home prices have hit their lowest level in five years, with the median price falling to levels not seen since July 2021. The median existing home price of $434,100 also remains above new home prices, marking an inversion of historical norms where previously owned homes typically commanded higher prices.
Consumer confidence has deteriorated significantly, with the Conference Board's consumer confidence index dropping to 89.4 in August from an upwardly revised 90.2 in July, marking a seven-month low. The decline was led by a 7.8% slide in the expectations index, while the jobs differential index rose for the first time in three months. Only 5.2% of American consumers now intend to buy a house in the next six months, down from 6.5% in July and representing the largest decline in more than five years. As per LPL Financial's Chief Economist Jeffrey Roach, "Consumers are optimistic about today but increasingly nervous about tomorrow." The housing market faces additional pressure as 30-year mortgage rates held at 6.77% in the week ended August 14, just shy of the recent high of 6.81% at the end of July, with prices by the Fed's inflation measure rising at nearly twice the 2% target pace. According to Oxford Economics Senior US Economist Matthew Martin, "The housing market isn't headed for a downturn, but rising mortgage rates and weaker growth in real disposable income due to elevated inflation will keep any rebound out of sight."
