by Average sales prices also continue to rise, potentially leaving less room in the budget for furniture
WASHINGTON — Sales of new single-family homes rose in December 2025 from a year earlier, according to recently released figures from the U.S. Department of Housing and Urban Development.
Median sales prices of new homes sold in December also declined from a year earlier, while rising from November, the department reported.
Sales in December totaled 745,000 units, up 3.8% from 718,000 in December 2024 and 1.7% below 758,000 in November 2025.
At the end of December, there were 472,000 new houses for sale, 3.5% below 489,000 in December 2024 and 2.7% below 485,000 in November 2025. The total in December represents a 7.6%-month supply at the current sales rate, compared with 8.2%-month supply in December 2024 and 7.7 months in November 2025.
Meanwhile, the report noted, the median sales price of new houses sold in December 2025 was $414,400, which is 2% below $423,000 in December 2024 and 4.2% above $397,600 in November 2025.
The average sales price of new homes sold in December was $532,600, up 4.7% from $508,900 in December 2024 and .5% above $530,200 in November 2025.
Higher new home prices are occurring despite builder efforts to reduce costs and provide incentives, reflecting higher materials and land development costs in particular, plus higher demand from a new generation of buyers seeking new construction versus existing homes.
“At the heart of the surge in housing prices lies the fundamental economic principle of supply and demand,” notes a study by the McDonough School of Business at Georgetown University. “When the demand outpaces the available supply of houses, prices naturally rise. Several factors contribute to this imbalance.”
Other factors it cites include limited housing supply, population growth and urbanization that are causing increased demand and competition for new homes and regulatory constraints that can “limit the development of new housing. Restrictions on building heights, densities and land usage limit the number of homes that can be built in high-demand areas.”
How this impacts furniture depends on how aggressively retailers market and price product to new homeowners in their regions. Indeed, the price of a new bedroom set, dining set and living room furniture, be it motion or stationary upholstery, along with occasional tables, can be daunting, particularly with tariff-related price increases.
While consumers that have not shopped for new furniture for some time may not know what price to expect on newer products, they certainly are prone to sticker shock.
Hence, they will not only compare prices between brick-and-mortar retailers and online home furnishings specialists. They are also likely to shop consignment and used furniture stores which often have high quality, U.S.-made products not susceptible to tariffs or other cost pressures. More on that later in a future column or two.
It’s a message retailers may not wish to hear, but competition is coming from many different realms. And when new and existing home prices continue to rise, consumers often don’t have much choice than to shop for the most inexpensive product possible even if it means buying used.
