Us New Home Sales Plummet Due to High Mortgage Rates
New home sales dropped 10.5% in January as persistently high mortgage rates sidelined potential buyers, with the median house price reaching a two-year high at $446,300. The decline was likely due to cold temperatures and snowstorms in much of the country last month. Economists now expect slower economic activity early in the first quarter.
- The relationship between affordability and home sales is particularly interesting in this context, as it highlights how rapidly changing mortgage rates can impact household consumption and overall economic growth.
- Will a rebound in consumer confidence and business investment be enough to offset the negative effects of high mortgage rates on the housing market?