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Washington, DC (CNN)New home sales rose in July from the month before, as buyers continue to look to new construction as an option in the face of a historically low supply of existing homes.
Sales of newly constructed homes were up 4.4% in July to a seasonally adjusted annual rate of 714,000 from a downwardly revised rate of 684,000 in June, according to a joint report from the US Department of Housing and Urban Development and the Census Bureau. Sales were up 31.5% from a year ago.
While the new construction market is being boosted by exceptionally low inventory, affordability concerns remain. Homeowners with mortgage rates of 3% or 4% are reluctant to sell and buy another home at a much higher rate. Last week, rates topped 7% and are not expected to cool off in the near future.
Sales of existing homes have been down for the past few months, while new home sales have been trending higher.
The median price of a new home was $436,700, according to the report.