July 2026 New Home Sales: Sales Plunge 10.5% as New Home Supply Surges to 9.6 Months
The joint monthly report from the U.S. Census Bureau and the Department of Housing and Urban Development (HUD), released on August 25, 2026, revealed a sharp cooling in the new residential sales market for July 2026. Sales of new single-family houses fell to a seasonally adjusted annual rate (SAAR) of 607,000, representing a 10.5% sequential drop from the revised June rate of 678,000, and a 6.3% year-over-year decline from July 2025's rate of 648,000.
This drop in sales has led to a significant accumulation of new home inventory. The seasonally adjusted estimate of new houses for sale at the end of July reached 488,000, representing a 9.6-month supply at the current sales pace. This is up 12.9% from June's 8.5 months of supply, indicating a growing mismatch between builder activity and buyer affordability.
Median sales prices have also begun to moderate under this inventory pressure.1 The median sales price of new homes sold in July was $393,800, down 2.3% from June's $403,100, and down 0.9% year-over-year from July 2025's $397,300. This indicates that homebuilders are increasingly forced to adjust pricing and offer incentives to move sitting inventory.
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An instance of Housing liquidity recovers only when sellers cut listing prices and builders halt new starts. — As unsold new home inventory accumulates, builders must adjust their pricing downwards to attract buyers in a rate-sensitive market. ↩︎