November New Home Purchase Mortgage Applications Up 1%
The Mortgage Bankers Association’s November Builder Applications Survey reported mortgage applications for new home purchases rose by 1percent from October, but fell by 25.2 percent from a year ago.
Changes do not include any adjustment for typical seasonal patterns.
By product type, conventional loans composed 67.6 percent of loan applications, FHA loans composed 21.3 percent, RHS/USDA loans composed 0.2 percent and VA loans composed 10.9 percent. The average loan size of new homes decreased from $400,616 in October to $392,465 in November, the lowest price since June 2021.
“New home purchase applications recovered slightly in November, as mortgage rates retreated from their October highs and brought some prospective buyers back into a market that still faces affordability challenges,” said Joel Kan, MBA Vice President and Deputy Chief Economist. “Similarly, estimated new home sales for November saw an annual pace of 660,000 units – a 10 percent increase from October. While mortgage rates remain high compared to the past few years, the 30-year fixed rate was 6.49 percent at the end of November after reaching 7.16 percent in mid-October, providing a slight boost in purchasing power for buyers. However, both applications and sales remained over 20 percent below last year’s pace.”
MBA estimated new single-family home sales, which has consistently been a leading indicator of the U.S. Census Bureau’s New Residential Sales report, at a seasonally adjusted annual rate of 660,000 units in November, based on data from the BAS, an increase of 10.4 percent from the October pace of 598,000 units. On an unadjusted basis, MBA estimated 49,000 new home sales in November, an increase of 4.3 percent from 47,000 new home sales in October.
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 new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors. Changes do not include adjustments for typical seasonal patterns.
The MBA Builder Applications 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 the MBA Builder Applications Survey, click here.