MBA: January New Home Purchase Applications Surge

January mortgage applications for new home purchases increased by 22 percent from December and by 9.2 percent from a year ago, the Mortgage Bankers Association reported this morning.

The MBA Builder Application Survey reported by product type, conventional loans composed 67.2 percent of loan applications, FHA loans composed 18.6 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 13 percent. The average loan size of new homes decreased from $331,354 in December to $329,806 in January.

This changes do not include any adjustment for typical seasonal patterns.

“As house prices continue to rise and inventories of homes available for sale remain low, it is not surprising that mortgage applications for new homes in January came in higher than a year ago,” said MBA Vice President of Research and Economics Lynn Fisher. “Alongside relatively low supply, rising household incomes and favorable demographics should continue to bolster demand for new homes, despite rising interest rates, leading to modest growth in new home sales this year.”

MBA estimated new single-family home sales ran at a seasonally adjusted annual rate of 562,000 units in January, an increase of 17.6 percent from the December pace of 478,000 units. On an unadjusted basis, MBA estimated 44,000 new home sales in January, a increase of 25.7 percent from 35,000 new home sales in December.

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