High mortgage rates and economic uncertainty continued to keep potential home buyers on the sidelines and constrain new home sales in September. New home sales declined from August and remained below year-ago levels, with year-to-date sales also lagging for 2025. Although builders have increasingly adjusted prices and offered incentives to attract buyers, elevated mortgage rates and ongoing affordability concerns continue to constrain sales activity.
Sales of newly built single-family homes declined 0.6% in September to a seasonally adjusted annual rate of 676,000, following a downwardly revised August estimate, according to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. This represented a 5.3% decline from a year earlier. On a year-to-date basis, new home sales are down 2.9%. A new home sale is recorded when a contract is signed, or a deposit is accepted, regardless of the stage of construction. The seasonally adjusted annual rate reflects the pace of sales that would occur over a 12-month period if current conditions persist.
New single-family home inventory in September was at 476,000 units and down 2.3% from a year ago. At the current sales pace, the months’ supply of new homes stood at an elevated 8.4 months, roughly unchanged from a year ago. A five- to six-month inventory level generally indicates a balanced market.
Combined new and existing home inventory has edged higher in recent months, with the total months’ supply reaching 5.2 months. Inventory conditions in the existing home market have gradually improved in recent months. Moderating prices across both markets have helped support buyer demand amid ongoing affordability concerns.
At the end of September, there were 111,000 completed, ready-to-occupy homes available for sale on a non-seasonally adjusted basis. Completed homes accounted for approximately one-quarter of total inventory, while homes under construction made up 53%. The remaining share of homes sold in September had not yet started construction at the time the sales contract was signed.
New home prices showed mixed movement in September, reflecting changes in the composition of sales and continued builder incentives. The median new home sale price was $400,400, up 3.9% from August but down 3.9% compared to a year ago. Homes priced between $300,000 and $499,999 accounted for half of all new home sales, while 20% of sales were priced below $300,000, underscoring ongoing affordability challenges for entry-level buyers. The remaining 31% of sales were priced above $500,000. It is worth noting that the share of homes priced below $300,000 has increased since the beginning of the year, while the share priced over $500,000 has decreased.
Regional performance was mixed in September. The Northeast posted the strongest monthly gain in sales, rising 28.0% from August, followed by the West, where sales increased 21.4%. In contrast, sales declined 6.6% in the South and 7.3% in the Midwest.
Compared with September 2025, the Northeast recorded a 10.3% increase in new home sales, the only region to post an increase. Sales declined 0.7% in the South, 8.2% in the Midwest, and 17.4% in the West.
On a year-to-date basis, regional trends were similarly uneven. New home sales increased 2.3% in the Northeast. Meanwhile, sales declined 0.5% in the Midwest, 1.3% in the South, and 9.2% in the West.
This article was originally published by a eyeonhousing.org . Read the Original article here. .
Terry Vinn of Totus Construction says he finds clients can be influenced by television renovation shows. “This can result in a costly mistake as clients have often already paid fees for an architect’s drawings or planning,” he says. “They realize they’re way off in terms of their budget.”
Cat Hoad of Absolute Project Management agrees, saying she often finds a budget is too low for the client’s aspirations in terms of scope and finish.
Solution: “Showing clients the best options and the reality of these costs is the best we can do to inform their choices,” Spencer says. “We always let our clients know they can purchase suggested items over time to spread the cost too.”
Encouraging clients to consider phasing the work is another option — tackling phase one now with the initial budget, then phase two a year or so later when the budget has recovered.
Vinn underlines the value of getting clients to engage with the builder at the concept stage of the project. “Builders can explain the cost differences between various design options, preventing the need to go back to the drawing board at a later stage, which would equal additional architect’s fees.”
Hoad agrees with starting the conversation early. “One of the first bits of paid work is to set up an outline budget,” she says. Her outline will have headings with the approximate cost for the various professionals involved and estimated costs for each part of the second fix.
“The total can, of course, change dramatically, but it’s a means for the client to see clearly how their money is likely to be spent, and it helps them to make decisions and prioritize accordingly,” she says.