ARLINGTON, Va.—After reaching "the high-water sales level since the crisis" in March with 723,000 annualized units, new home sales fell 6.9% to 673,000 units in April. NAFCU Research Assistant Dhruv Singh said despite the drop, there are positive signs within the market.
"Declining mortgage rates and a strong labor market continue to support sales," Singh said. "While supply of existing homes remains tight, the new homes market does not face the same capacity constraints. Conditions are in place to see solid growth through the rest of the year, but the question will be whether success in the new homes market can translate to the much larger existing homes sector."
Sales fell in three of the four regions in April. Sales in the West fell 8.3%, followed by decreases in the Midwest (-7.4%) and the South (-7.3%). Sales in the Northeast increased 11.5%.
Based on current month sales, there were 5.9 months of supply in April, up from 5.6 months in March. The number of unsold homes left on the market fell from 335,000 to 332,000 units. This represents an 11% increase from a year ago, Singh said.