New Home Sales Soften in April with Growing Housing Affordability Concerns

Rising building materials costs and low inventory have caused new home sales prices to jump 20 percent on a year-over-year basis, harming housing affordability and driving down the pace of new home sales. Sales of newly built, single-family homes fell 5.9 percent following a significant downward revision of the March estimate, to an 863,000 seasonally adjusted annual rate, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.

"Affordability factors are clearly affecting new home sales," said Chuck Fowke, chairman of the National Association of Home Builders (NAHB) and a custom home builder from Tampa, Florida. "A growing number of builders are limiting sales in order to manage supply chains, including access and cost factors associated with lumber, appliances, and other building materials. Policymakers need to find ways to improve the supply-chain, by facilitating more domestic production, or in cases where that cannot be done, suspending tariffs to allow for more imports."