New Home Sales Up in February

Sales of new single-family houses during February were at a seasonally adjusted annual rate of 676,000, according to estimates published by the US Census Bureau and the Department of Housing and Urban Development. This is 1.8% above the revised January rate of 664,000 and 5.1% above the February 2024 estimate of 643,000.

The median sales price of new houses sold in February 2025 was $414,500 while the average sales price was $487,100. The seasonally adjusted estimate of new houses for sale at the end of February was 500,000, which represents a supply of 8.9 months at the current sales rate.

Reaction to the latest data was mixed. National Association of Home Builders Chief Economist Robert Dietz observed, “Lower mortgage rates helped to lift demand in February, despite other near-term risks such as tariff issues and affordability concerns. While new home inventory is at an otherwise elevated 8.9 months’ supply, total home supply – new and existing – is a relatively lean 4.2 months’ supply for February.”

Zillow Senior Economist Orphe Divounguy opined, “After weather-related disruptions in January, sales of newly-built homes rebounded in February. New home sales increased in the relatively more affordable South (+6.6%) and Midwest (+20.6%). Escalating economic policy uncertainty is causing economic momentum to slow. With hiring rates at a decade-low and job prospects slowly dwindling, households curtailed their spending last month. When households are bearish about future income, they tend to save more. In January, the savings rate rose to 4.6% from 3.5%, according to data from the Department of Commerce. The silver lining: Mortgage rates have been declining since January. Lower rates significantly impact buyers’ purchasing power and influence their decision to move.”

First American Chief Economist Mark Fleming stated, “New-home sales are improving, but well below what’s needed, increasing 1.8% on a monthly basis to 676,000, slightly below the consensus estimate, which was predicated on the fact that mortgage rates were declining in February, typically a boost to new-home sales.”

Fleming added, “However, comparing the number of new homes for sale today with a number from the past is not a good apples-to-apples comparison because the number of households, or the demand for shelter, is constantly growing over time. So, 676,000 new-home sales today is, relatively speaking, not the same as 676,000 sales in the mid- 1990’s when accounting for the increase in the amount of demand.”