Investing.com -- A monthly survey of homebuilders showed sales momentum from June reversed in July as mortgage rates climbed above 6.8% and oil prices rose, according to the BTIG/HomeSphere Homebuilder Survey released this week.

The survey, which collected responses from 48 small- and mid-sized tract and custom homebuilders across the country, found that 27% of builders reported higher year-over-year sales in July, down from 35% in June. Builders reporting lower year-over-year sales jumped to 38% from 27% in the prior month.

Customer traffic proved more stable than sales. About 33% of builders reported higher year-over-year traffic in July, compared to 38% in June. The share of builders reporting lower traffic improved to 23% from 27% in June.

Sales relative to builder expectations weakened in July, with 23% reporting better-than-expected sales versus 29% in June. Traffic relative to expectations showed improvement, as 31% of builders reported better-than-expected traffic compared to 27% in June.

On pricing, 21% of builders raised some, most, or all base prices in July, up slightly from 19% in June. The percentage lowering base prices remained flat, while builders reporting mixed pricing actions rose to 29% from 21% in June.

Incentive use decreased, with 19% of builders increasing some, most, or all incentives in July, down from 29% in June. The share of builders leaving incentives unchanged rose to 56% from 54% in June.

The July results came as the Iran conflict escalated, pushing mortgage rates above 6.8% and WTI oil above $90 at peak levels. Builder commentary indicated traffic was not translating into sales.