MBA: September New Home Purchase Mortgage Applications Down 9%
Mortgage applications for new home purchases fell by 9 percent in September from August but improved by 8.2 percent from a year ago, the Mortgage Bankers Association reported this morning.
The MBA Builder Application Survey reported by product type, conventional loans composed 71.0 percent of loan applications, FHA loans composed 16.0 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 11.9 percent. The average loan size of new homes increased from $332,801 in August to $333,086 in September.
Changes do not include any adjustment for typical seasonal patterns.
“Even though new home sales decreased 3.9 percent over the month, the average monthly number of homes sold so far this year [648,000 units] is 8 percent higher than a year ago, and last month’s 8.2 percent annualized gain in purchase applications points to continued demand for new homes,” said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “Housing demand is still strong even as mortgage rates increase, and as a result, we’re still forecasting for modest growth in purchase origination volume in 2018.”
MBA estimated new single-family home sales at a seasonally adjusted annual rate of 643,000 units in September, a decrease of 3.9 percent from the August pace of 669,000 units. On an unadjusted basis, MBA estimated 50,000 new home sales in September, a decrease of 5.7 percent from 53,000 in August.
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.
