New home sales took a notable step back in January, reversing much of the prior month’s strength and highlighting the volatility that often defines this data series. The Census Bureau reported a seasonally adjusted annual rate of 587,000, down sharply from December’s 712,000 and 11.3% lower than January 2025.
For-sale inventory moved slightly higher to 476,000, up 0.4% from December but still 4.0% below year-ago levels. At the current sales pace, months’ supply jumped to 9.7 months, up from 8.0 months in December and 9.0 months one year ago. The increase reflects the combination of softer demand and relatively steady inventory levels.
Prices declined on both a monthly and annual basis. The median sales price fell to $400,500 (-4.5% MoM; -6.8% YoY), while the average price dropped to $499,500 (-5.9% MoM; -3.6% YoY). The pullback suggests a shift in the mix of homes sold, with less upward pressure from higher-priced transactions.
- Sales (MoM): -17.6%
- Sales (YoY): -11.3%
- Inventory (YoY): -4.0%
- Months’ Supply: 9.7 (up from 8.0 prior month; 9.0 YoY)
