New Home Sales, which measure signed contracts on new homes, rose 4.4% from June to July to a 714,000-unit annualized pace. This reading was better than expected and the highest amount since February of last year. 

What’s the bottom line? The lack of existing homes for sale is heightening the demand for new homes, but the available supply of new construction remains below healthy levels. Of the 437,000 new homes available for sale at the end of July, only 75,000 were completed, with 254,000 under construction and 108,000 not even started yet.

The tight supply of both existing and new homes will continue to be supportive of home prices, making homeownership a good investment and opportunity for building wealth through real estate.

On that note, the median sales price for new homes was $436,700, which was down from $478,200 a year ago. Despite what the media might suggest, this figure is not the same as appreciation but represents the mid-price and can be skewed by the mix of sales among lower-priced and higher-priced homes. Multiple appreciation reports, including those from Case-Shiller, CoreLogic, Zillow, Black Knight and the Federal Housing Finance Agency, have reported strong price growth in their respective indexes.