US new home sales cooled in September as mortgage rates surged

In September, the sale of new homes in the United States slowed, according to government data released on Tuesday. The slowdown was attributed to rising mortgage rates and mounting concerns over affordability as the country prepares for midterm elections next month. New home sales declined by 0.6 percent from the previous month, reaching a seasonally-adjusted annual rate of 676,000 in September, as reported by the Commerce Department.

While this figure exceeded market expectations of 653,000, it remained 5.3 percent below the rate observed in the same month a year ago. As US mortgage rates surpassed 7.0 percent in September, marking the highest level since President Donald Trump's return to office, affordability became a significant concern among voters. The popular 30-year fixed-rate mortgage averaged 7.03 percent in late September, as indicated by Freddie Mac data.

The increasing cost of living, coupled with the rise in mortgage rates, has been dampening property sales throughout the year, with American households facing mounting pressure from surging gasoline costs. The median sales price of new homes sold in September increased by 3.9 percent month-on-month, reaching US$400,400.