U.S. New Home Sales Plunge 10.5% in July, Far Worse Than Expected

U.S. new home sales fell 10.5% month-over-month in July to 607,000 units, the lowest in six months and far worse than the expected 1.4% decline. Excluding January 2026, this is the lowest level since November 2022.
New home sales have now fallen in three of the last four months and are down 6.3% year-over-year. The Midwest was hit hardest, with sales plunging 42.7% month-over-month to 43,000, the lowest level since 2012. Sales in the South, the nation's biggest homebuying region and more than 60% of the total, fell 13.0% to 383,000, the second-lowest level since January.
This comes as the 30-year mortgage rate hit 6.81%, its highest since August 2025, weighing on homebuyer demand.