US new home sales drop surprisingly in Sept. despite record low mortgage rates

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US new home sales drop surprisingly in Sept. despite record low mortgage rates

On Monday, US Commerce Department had issued a saying that the sales of new US single-family homes had tumbled in September despite record-low long-term mortgage rates, while the decline which analysts said had been bolted out of the blue came forth after straight four months of increases in new home sales.

Nonetheless, the US housing market which has been one of the bright spots in an ailing US economy, remained well-supported amid a record-low mortgage rate alongside a soaring demand of more spaces over the narratives of a second wave of pandemic outbreak in the United States.

US new home sales fall unexpectedly in Sept.

In point of fact, latest US Commerce Department data which had revealed a surprise plunge in the sales of new single-family homes in the United States last month, came against the backdrop of a buoyant Government data that had shown last week the single-family homebuilding and applications for permits had raced to a nearly 14-year peak in September, while US homebuilders’ confidence had spiked to a record high this month.

Besides, the sales of existing homes in the United States had space-dived to a nearly 15-year peak last month, as record-low mortgage rates in the US with the popular-most 30-year fixed home loans residing at 2.80 per cent, had been shoring up US housing market.

Aside from that, according to the US Commerce Department data on new single-family home sales in September, new home sales slid 3.5 per cent to a seasonally adjusted 959,000 units in Sept., while August US new home sales had been revised down to 994,000 units from an initial sales figure of 1.011 million units.

Nonetheless, while the US new home sales in September had missed an analysts’ estimate of a rise of 2.8 per cent to 1.025 units, downplaying the impacts of September data, an economist at Wall St.

lender JPMorgan, Daniel Silver wrote in a client note, “While there could be some ups and downs along the way, we still look for strength in the housing market as low mortgage rates boost activity and earlier pent-up demand for housing is released.