Sales of new single-family homes in the US have unexpectedly fallen in May, which is another signal that high mortgage rates continue to put pressure on the housing market, reports Bloomberg, citing data from the US Department of Commerce.
Sales have decreased by 6.3% compared to the previous month to a seasonally adjusted annual rate of 623,000 homes. The result is significantly below the average forecasts of economists, who expected growth in the market.
According to analysts, the main reason for the weaker performance remains mortgage loans with interest rates around and above 6.5%, which continue to limit the affordability of housing for a large part of American households. High home prices are also contributing to buyer caution.
The data shows sales are down across most regions of the country, with the biggest declines in the southern states, which traditionally account for the largest share of the new-build market.
At the same time, the supply of new homes remains near its highest levels in years. This is putting additional pressure on builders, who are increasingly offering incentives to buyers in the form of discounts, financing costs or temporary mortgage interest discounts.
Despite the weak May data, the housing sector continues to benefit from a tight supply of existing homes. Many homeowners are reluctant to sell their properties because they financed their purchases at significantly lower interest rates in recent years.
Economists expect the housing market to remain under pressure in the second half of 2026 unless the Federal Reserve takes more serious steps to lower interest rates. For now, however, a robust labor market and still-high inflation limit the scope for faster monetary policy easing.
New data confirms that the US housing sector continues to move between strong demand for housing and the challenge of high financing costs, which remain a key obstacle for potential buyers.
Detailed statistics on average property prices in Bulgaria by city and neighborhood can be found at imot.bg