Negative changes in new U.S. home salesPresident Trump's tax reform is likely having a negative effect on the housing market, according to a newly published study by researchers at the Federal Reserve Bank of New York.

In addition to the uptick in mortgage interest rates, the Tax Cuts and Jobs Act of 2017 contributed to the recent decline in new housing sales, said Richard Peach and Casey McQuillan, co-authors of the study, in a April 15 blog post.

Sales of new single-family homes declined by 7.6 percent from the fourth quarter of 2017 through the end of the third quarter of 2018. And while mortgage interest rates rose by roughly 70 basis points during the period, the drop in home sales was larger than in the two previous episodes, in 2013 and 2016 respectively, when rates rose by a comparable amount, suggesting additional pressure of prospective home buyers.

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