In April/May 2021 new sales materially decreased even though interest rates were relatively stable at 3.25%.
COVID first appeared in the US in March 2020 and Mortgage rates went below 3.00% between Oct-Feb 2021. While this may have brought forward demand and thus decreased sales in later months, sales have not returned to the elevated levels of 2020 but may have returned to a trend that prevailed prior to COVID.
When COVID first appeared in the US, new home sales initially dropped and then sharply rebounded as mortgage rates hit multi-generation lows of 3.00%. With a sudden surge in sales, months of inventory dropped. When mortgage rates rose in early 2021, sales pulled back and months of inventory returned to levels that prevailed prior to COVID
It is important to note the large increase in Months of Inventory that occurred in November 2018. That is when Mortgage rates hit 5.00% and sales slumped. On April 14, 2022, rates went above 5.00%