MBA: June New Home Purchase Applications Down 4%; Up 10% from Year Ago
The Mortgage Bankers Association reported mortgage applications for new home purchases decreased by 4 percent in June from May but increased by 10 percent from a year ago.
The MBA Builder Application Survey said by product type, conventional loans composed 70.0 percent of loan applications, FHA loans composed 16.7 percent, RHS/USDA loans composed 1.3 percent and VA loans composed 12 percent. The average loan size of new homes increased from $324,844 in May to $327,833 in June.
“We are at the part of the season where housing market activity normally begins to slacken and this was true for mortgage applications for new homes in June,” said MBA Vice President of Research and Economics Lynn Fisher. “That said, activity was up by 10 percent relative to one year ago.”
Fisher added the shortage of existing housing supply should keep pressure on prices and new homebuilding throughout the balance of this year and into next.
MBA estimated new single-family home sales at a seasonally adjusted annual rate of 628,000 units in June, up by 18 percent from a year ago, based on BAS data and an increase of 3.8 percent from the May pace of 605,000 units. On an unadjusted basis, MBA estimated 55,000 new home sales in June, a decrease of 3.5 percent from 57,000 new home sales in May.
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.
