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MBA: February New Home Purchase Applications Rise
Mortgage applications for new home purchases increased in February by 16 percent and improved by 2.2 percent from a year ago, the Mortgage Bankers Association reported this morning.
The MBA Builder Application Survey said conventional loans composed 66.5 percent of loan applications, FHA loans composed 18.6 percent, RHS/USDA loans composed 1.3 percent and VA loans composed 13.6 percent. The average loan size of new homes increased from $329,806 in January to $330,208 in February.
The changes do not include any adjustment for typical seasonal patterns.
“The bar was high as last February was a particularly strong month for applications, as was March 2016,” said MBA Vice President of Research and Economics Lynn Fisher. “The surprisingly strong employment numbers for the beginning of 2017 suggest that demand for new homes should continue to grow this year. Additionally, based on the current reading, we expect seasonally adjusted new home sales to be up by about 8 percent in February compared to a year ago.”
MBA estimated new single-family home sales at a seasonally adjusted annual rate of 586,000 units in February, an increase of 4.3 percent from the January pace of 562,000 units. On an unadjusted basis, the MBA estimates 51,000 new home sales in February, an increase of 15.9 percent from 44,000 new home sales in January.
The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.
The MBA Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. Using these data, as well as data from other sources, MBA provides an early estimate of new home sales volumes at the national, state and metro level. These data also provide information regarding types of loans used by new home buyers. Official new home sales estimates are conducted by the Census Bureau on a monthly basis. In those data, new home sales are recorded at contract signing, which is typically coincident with the mortgage application.
For additional information on MBA’s Builder Applications Survey, click https://www.mba.org/news-research-and-resources/forecasts-data-and-reports/single-family-research/servicing-operations-study-and-forum-for-prime-and-specialty-servicers-x75411.