Sales of new homes in the United States saw a slight increase in February 2025, as national figures rose by 1.8% to a seasonally adjusted annual rate of 676,000. This data reflects ongoing shifts in the housing market, amid affordability challenges that continue to exert pressure on homebuyers, especially in the Northeast region, where sales dropped sharply.
The U.S. Department of Housing and Urban Development and the Census Bureau released these findings, indicating that the February sales rate marks an improvement from January’s revised figure of 664,000. Furthermore, February sales reflect a 5.1% increase compared to the same month in 2024, highlighting slight resilience within the housing sector.
Despite the national trends appearing somewhat positive, the Northeast registered the weakest sales activity in the nation. With only 22,000 new homes sold in February, this was a staggering 48.8% drop from the previous year. Reports are painting a challenging picture for potential buyers in this region, as economic uncertainties take hold.
“New home sales have been roughly flat thus far in 2025, as ongoing limited inventory of existing homes in many markets continues to support the need for new homes,” said Buddy Hughes, Chairman of the National Association of Home Builders (NAHB). This lack of inventory remains a critical issue affecting the overall market.
The report revealed that most of the new home sales occurred in the South, with 438,000 sales, followed by the West at 140,000, and the Midwest, which contributed 76,000 to the national figures. In stark contrast, the Northeast’s figures underscore the degree to which the region struggles in attracting homebuyers.
For the month of February, the median price of new houses nationwide stood at $414,500, while the average sales price reached $487,100. Those statistics indicate subtle price adjustments amidst fluctuating buyer demand, a concerning factor for many considering the current market. The estimated new home inventory at the end of February was around 500,000 units, representing an 8.9-month supply at the current rate of sales.
In addition to the new home statistics, the National Association of Realtors (NAR) reported existing home sales, which encapsulate a broader market perspective. These sales also experienced a national increment of 4.2% from January, achieving an annual rate of 4.26 million transactions. However, when viewed year-over-year, existing home sales reflected a 1.2% decline from February 2024.
In the Northeast, sales of existing homes also declined by 2.0% from January 2025 to an annual rate of 500,000. However, this number does represent a 4.2% increase compared to February 2024, indicating some signs of a rebound from the previous year’s figures.
The median price for an existing home in the Northeast was recorded at $464,300—an increase of 10.4% year-over-year—signifying the rising costs associated with homeownership in the region. Nationwide, the median price for an existing home was at $398,400, marking an upward trend of 3.8% from the previous year.
Echoing Hughes’ observations, Robert Dietz, Chief Economist of NAHB, commented on recent trends in mortgage rates, stating, “Lower mortgage rates helped to lift demand in February, despite other near-term risks such as tariff issues and affordability concerns.” As of March 20, 2025, the average rate for a 30-year fixed mortgage was 6.67%, slightly up from 6.65% the week before but down from 6.87% a year ago.
Despite conditions showing signs of market stabilization, the overarching theme suggests that home affordability continues to be a significant hurdle for prospective buyers. As fewer current homeowners list their properties for sale, the limited inventory dynamics exacerbate challenges in a high-demand market.
In conclusion, the February 2025 housing market report showcases a mixed bag of data, with new home sales showing slight gains nationally and stark declines in the Northeast. The combination of rising prices, persistent inventory challenges, and fluctuating mortgage rates paints a complex picture for all stakeholders in the real estate market.
