WASHINGTON—Sales of new homes in the U.S. fell in January, signaling a weak start to 2019 for the troubled U.S. housing industry.
New-home sales fell 6.9% in January from a month earlier to a seasonally adjusted annual rate of 607,000, the Commerce Department said Thursday.
Economists surveyed by The Wall Street Journal had expected new-home sales to rise to an annual rate of 622,000 in January. The rate in December was revised up to 652,000 from an initial estimate of 621,000.
The new-home sales figure is a rough estimate that comes with a big margin of error. The figure is often revised later.
Sales of new homes were down 4.1% in January compared with a year earlier.
Higher mortgage rates and a run-up in prices put a dent in home purchases in 2018. The average rate on a 30-year, fixed-rate mortgage rose about 1 percentage point to nearly 5% from the start of 2018 to last November, according to Freddie Mac. Since then, borrowing costs have dropped, hitting a low of 4.35% at the end of February before inching up again last week.
At the current sales pace, there was a 6.6-month supply of new homes on the market at the end of January, slightly above the revised 6.3-month supply in December.
Newly built homes are a slice of the overall housing market. Previously owned homes, known as existing homes, are the bulk of the market.
Existing-home sales fell 1.2% in January from the prior month, the National Association of Realtors reported last month. Last year marked the weakest for home sales since 2015.