New Home Sales Jump in March

(Illustration courtesy of Census Bureau/HUD and Wells Fargo Economics)

New home sales jumped 7.4% in March compared to February, the Census Bureau and HUD reported Wednesday.  

The current seasonally adjusted annual rate of 724,000 is 6% above the March 2024 rate.

In a written analysis, Wells Fargo Economics called March’s stronger pace of sales an encouraging sign that the new home market was not falling apart ahead of the new tariffs and associated market volatility. “Moving forward, however, significantly reduced policy certainty, the recent bounce in mortgage rates and dimming economic growth prospects stand as formidable headwinds,” the report said.

Selma Hepp, Chief Economist of Cotality (formerly CoreLogic), noted home sales are showing a seasonal uptick and cautioned that they continue to trend below 2024 levels despite new for-sale inventory reaching the highest level since 2009. “In addition, many markets with growing new inventories have also experienced a significant rise in existing inventories and weaking overall demand, which is challenging homebuilders’ pricing power and poses the need for more incentives,” she said.

Hepp added that the housing market faces a repeated challenge from a recent jump in mortgage rates, “which are likely to remain volatile and elevated,” she said.