MBA: June New Home Purchase Mortgage Applications Down 12%
Mortgage applications for new home purchases fell by 12 percent in June from May and by nearly 9 percent from a year ago, the Mortgage Bankers Association reported this morning.
The MBA Builder Applications Survey said by product type, conventional loans composed 71.3 percent of loan applications, FHA loans composed 15.9 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 11.6 percent. The average loan size of new homes decreased from $337,515 in May to $333,033 in June.
Changes do not include any adjustment for typical seasonal patterns.
“Applications for new home purchases fell in June, both compared to last year at this time and relative to May, which fits the seasonal pattern,” said MBA Chief Economist Mike Fratantoni. “So far this year, new home applications are up 2.5 percent relative to the first six months of 2017. Our sense is that builders remain constrained by the tight job market for construction labor and rising input costs, particularly lumber costs.”
MBA estimated new single-family home sales at a seasonally adjusted annual rate of 587,000 units in June, a decrease of 6.2 percent from May (626,000 units). On an unadjusted basis, MBA estimated 53,000 new home sales in June, a decrease of 11.7 percent from 60,000 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.
