New Home Sales Fall In February

There are a couple of reasons new home sales are important to watch. First, they account for just over 11 percent of all home sales. Secondly, they’re a leading indicator, since they are counted when a contract to buy is signed, rather than at closing. In other words, you can get a good feel for what’s ahead for the housing market by paying attention to new home sales. In February, according to numbers from the U.S. Census Bureau and the Department of Housing and Urban Development, sales slowed, dropping 2 percent from the month before and 6.2 percent from where they were last year at the same time. That’s a sign that the housing market may be cooling off after a hot and competitive 2021. With mortgage rates edging higher and prices up significantly, there may be fewer buyers active in the market this year. But that may be good news for buyers who are still active, as fewer buyers means less competition and slower price increases. Along with an expected increase in new home construction this year, reduced buyer demand could mean a better balanced market for home buyers still looking for a home to purchase. (source)

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