New home sales rose in the second quarter but were lower than a year ago, according to the U.S. Census Bureau New Residential Sales release. The share of homes purchased with conventional financing remains high, while the share purchased with Federal Housing Administration (FHA) financing rose to its highest level since early 2021. The share of new homes purchased with cash fell to its lowest share since 2007.
An estimated 170,000 new homes were sold in the second quarter, up from 165,000 in the first but down from 178,000 a year ago. By financing, 123,000 were conventionally financed. Conventional mortgage loans are loans not classified as a VA loan or FHA loan. FHA financed sales were estimated at 33,000. FHA mortgage loans are insured by the Federal Housing Administration. VA financed sales were estimated at 9,000. VA mortgage loans are guaranteed by the U.S. Department of Veterans Affairs. Cash sales were estimated at 6,000 houses in the second quarter.
As a share of homes sold, 71.9% were conventionally financed, 19.3% of FHA financed, 5.3% were VA financed, and 3.5% were cash purchased. The cash purchase share was the lowest since the fourth quarter of 2007, when 3.4% of homes sold were cash purchases.
Sales Price by Financing
The median sales price of a new home in the second quarter was $410,700, higher than the first quarter ($408,500) but down from a year ago ($416,100). The highest median sales price by financing type was for cash purchases at $467,100, which was closely followed by VA financing at $457,500. Conventional financing has a median sales price of $430,700, while the median sales price for FHA financing was $366,700.
