U.S. new home sales in the last two months of 2025 delivered a Christmas surprise for the housing market, with November reaching a near four-year high and December close behind.
The Census Bureau data released on the same day show that an annual rate of 745,000 new single-family homes were sold in December, just a 1.7 percent decrease from November and firmly above market expectations of 730,000, representing the second-highest level during the period.
The December sales rate was 3.8 percent higher than the year-ago rate of 718,000 units.
However, full-year sales came in at an estimated 679,000 units in 2025, 1.1 percent below the 686,000 units sold in 2024.
Midwest sales of new construction in December skewed sharply higher, at 31.7 percent, to 108,000, while sales in the West advanced by 9 percent to 170,000. New home sales in the Northeast experienced a 37.3 percent drop to just 37,000, while sales in the South decreased by 6.7 percent to 430,000.
The median new home sales price was $414,400 in December, 4.2 percent higher than the November median of $397,600, and 2.0 percent lower than the $423,000 reported in December 2024.
According to the Census Bureau, the sale of a new house begins with the signing of a sales contract or acceptance of a deposit. The house itself can be any stage of construction—not yet started, under construction, or already completed. New home sales represent about 10 percent of the U.S. housing market.
Regionally, month-over-month pending home sales actually increased in the Midwest and West, while decreasing in the Northeast and South. Analyzing year-over-year statistics, the South and West were winners with rising pending home sales, but the Northeast and Midwest saw declines.
“Improving affordability conditions have yet to induce more buying activity,” NAR Chief Economist Lawrence Yun said in the report.
“With mortgage rates nearing 6 percent, an additional 5.5 million households that could not qualify for a mortgage one year ago would qualify at today’s lower rates.”
Yun said that many newly qualified households tend to wait before joining the house hunt. However, he noted that even if 10 percent of them enter the market, that could equate to another 50,000 new homebuyers for this year compared to 2025.
“Unless housing supply increases, these additional potential buyers becoming active in the market could simply push up home prices,” Yun said.
“This will put increasing pressure on affordability, which is why it is critical to increase supply by building more homes.”
