New home sales fall 12.6% in July as rising prices take a toll

New home sales plunged in July as high prices and mortgage rates pushed buyers to think twice about closing the deal.

Sales of newly constructed homes fell by 12.6% in July from June and were down 29.6% from a year ago, according to a joint report from the US Department of Housing and Urban Development and the US Census Bureau. It was the second consecutive month of declines.

Only 511,000 new homes were sold last month, at a seasonally adjusted annualized rate, down from a revised 585,000 in June. That’s the lowest sales number since January 2016. A year ago, 726,000 newly constructed homes were sold.

Meanwhile, the median price for a new construction home rose to $439,400, up from $402,400 the previous month.