Sales of new U.S. homes plunged in July as many say the mortgage rates are too high and affordability has greatly decreased
The July numbers represent a 6-1/2-year low in the U.S.
The report from the Commerce Department says that the Federal Reserve’s aggressive monetary policies that aimed to slow down the economy to ease inflation is working, but house prices remain high.
And according to Reuters, this is due to a critical shortage of previously owned properties, also adding that a total collapse is unlikley.
How about mortgage rates?
Mortagage rates generally move in liason with U.S treasury yields- they’vr greatly increased to 5.13%, moving up from 3.22% at the start of the year.
Even though demand has dropped, house prices still remain stable.
The average house price in July was $439,400 dollars, that’s an 8.2% jump from the same period last year.
All in all, it is the post-pandemic recovery period for many economies, and these latest figures seem to be similar to other from around the world.
