New home sales came in much lower than expected for November. Shares of the major home building stocks such as Lennar, DR Horton and Toll Brothers, dropped more than -2% following the news.
New home sales dropped -11% month-over-month in November, according to the U.S. Census.
While mortgage rates fell rapidly in November, higher home prices could have weighed on affordability, thereby affecting contract signings. Strong home demand against limited inventory has been a prominent theme in U.S. housing market this year – something that has fueled price gains while apparently starting to challenge affordability.
The median price of a newly built home increased +2.2% year-over-year in November to $335,300.