New Home Sales Jump in December While Prices Fall to 2-Year Low as Lower Mortgage Rates Spur Demand
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Sales of new single-family homes jumped 8% in December 2023 compared to November. For the full year, sales rose over 4%.
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The median sales price of new homes fell to $413,200 in December, the lowest level in 2 years, as builders offered discounts.
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Mortgage rates have declined from over 8% in October 2022 to under 7%, encouraging buyers to enter the market.
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Smaller, more affordable homes made up 43% of new houses sold in 2023 as builders targeted moderate-income buyers.
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If mortgage rates stay below 7% or fall further, demand could increase in 2024 from first-time and trade-up buyers.