US New Home Prices Drop as Inventory Glut Grows

The median price of new single-family homes in the US fell to $398,300 in June, down 2.7% year-over-year and 13.5% from the October 2022 peak, according to Census Bureau data. The three-month average median price dropped to $408,800, down 1.7% year-over-year and 6.7% from two years ago. Sales declined 5.3% year-over-year to 54,000 homes, the third consecutive monthly drop, and were 18% below June 2019 levels. Inventory rose to 491,000 homes, a 9.3-month supply, with 61% in the South. In the South, inventory surged 71% from 2019 while sales fell 8%, creating a glut. In the West, sales plunged 25% year-over-year and 50% from 2019 to just 9,000 homes. Homebuilders are using incentives and mortgage-rate buydowns to boost sales, but their stocks have dropped sharply since mid-September 2024: D.R. Horton down 23%, Lennar down 51%, while Pulte Group fell only 3%. Taylor Morrison was acquired by Berkshire Hathaway this year. Inventory of completed homes stood at 113,000, up 49% from 2019. The data excludes builder incentives and buydown costs.