Applications for mortgages for new home sales increased 0.2% in August compared with July and were up an impressive 33% compared with August 2018, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey.
The index, which is not adjusted for seasonal patterns, shows that applications for conventional loans represented about 69.3% of loan applications for new home sales in August, while Federal Housing Administration loans represented 18.1%, Veterans Affairs loans represented 11.8% and Rural Housing Service/U.S. Department of Agriculture loans represented 0.8%.
The average loan size of a new home increased to $332,497, up from $325,457 in July.
”New home purchase activity was robust in August, as both mortgage applications and estimated home sales increased from a year ago,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Recent increases in new residential housing permits and housing starts, lower mortgage rates, and a still-strong job market all bode well for the new home sales outlook.”
The MBA estimates that sales of new single-family homes were at a seasonally adjusted annual rate of 785,000 units in August, an increase of 4.1% compared with the July pace of 754,000 units.
On an unadjusted basis, the MBA estimates there were 61,000 new home sales in August, a decrease of 3.2% compared with about 63,000 in July.
Chris Carter | Residential Lending
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