I’ve discussed this this episode from the HousingWire Daily podcast and today I’m showing the key data line that explains why this is the case.
By Census: Sales of new houses: Sales of new single-family homes reached a seasonally adjusted 745,000 in December 2025, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 1.7 percent (±14.5 percent)* below the November 2025 figure of 758,000, and 3.8 percent (±18.3 percent)* above the December 2024 figure of 718,000.
Mortgage rates are near 6%, which means it costs builders less to make a buyout, and because they sell homes as a commodity, they are doing their best to control this cycle and their profit margins. This means that in recent years, selling a new home has been more of a calculation of how much construction credit they can and should give. That said, if you take out the spike in COVID-19 sales and the lows in 2022, new home sales have been stuck in a range for a decade.
Inventory and months stock for sale: The seasonally adjusted estimate of the number of new homes for sale at the end of December 2025 was 472,000. This is 2.7 percent (±1.3 percent) below the estimate of 485,000 in November 2025, and 3.5 percent (±4.8 percent)* below the estimate of 489,000 in December 2024. This represents a supply of 7.6 months at the current sales pace. Monthly supply is 1.3 percent (±12.2 percent)* below the November 2025 estimate of 7.7 months, and 7.3 percent (±15.0 percent)* below the 8.2 months estimate of December 2024.
Looking at the charts below, it appears that some progress has been made in terms of inventory and monthly supply.
So why did the builder’s confidence a bit sour this week?
The truth of the builders
As I’ve always said, the builders are not the March of Dimes, and they don’t like to see completed units above 120,000 for sale. History has shown that when this date line crosses 120,000, builders aren’t really putting the pedal to the metal in home construction.
Conclusion
So new home sales and the start of home construction this week have told us the same story we’ve been watching for years. Not much is happening on either side: new home sales are neither crashing nor breaking out. For the total number of completed units to drop significantly, we will need more growth in new home sales. Housing permits haven’t gotten worse lately, but we’re not really growing much either. This is the way the world works with this housing sector, don’t make it complicated.
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