Home builders relied on incentives and a break in interest rates to push up new home sales in 2024, help💎ed along by a late rally in December.

December new home sales were up 6.7% year-over-year, a strong closing to help push new home sales up to an estimated 683,000 for all of 2024. That was a 2.5% increase over the prior year, according to Census Bureau data released Monday. This compares with existing home sales, which declined in 2024 to their lowest levels in 30 years.&nb⛄sp;

Builders had an advantage over existing home sellers because they could offer more incentives, especially as homes became the most unaffordable in decades. 

“Builders have used incentives like mortgage rate buydowns and price cuts to soften the blow, underpinning the resilience in new home sales,” wrote Wells Fargo economists Charlie Dougherty, Jackie Benson and Ali Hajibeigi.

Housing Inventory Remains Flat as New C🐟onstruction Slows

But while sales were higher, the number of newly built homes on the market remained somewhat flaℱt.

If every new home on the market was sold without completing new ones, the inventory of homes would run out in 8.5 months in December, the Census Bureau data showed. Economists said overall for-sale 澳洲幸运5官方开奖结果体彩网:inventory levels could still remain a dra𒈔g on the housing market. 

“December’s advance may foreshadow that 2025 will be ꦛa better year for home construction, as builders focus on smaller homes on smaller lots, and more incentives,” wrote Robert Frick, corporate economist with Navy Federal Credit Union. “But the pace of building must pick up substantially to help solve the core issue of the housing crisis: too few houses for sale.”