Mortgage applications for new home purchases in August were down 6% from July but were also 1% higher from one year ago, according to new data from the Mortgage Bankers Association (MBA).
The MBA estimated new single-family home sales were running at a seasonally adjusted annual rate of 730,000 units in August, a 6.6% increase from the July pace of 685,000 units. On an unadjusted basis, MBA estimated that there were 56,000 new home sales last month, a decrease of 3.4% from 58,000 new home sales in July.
The average loan size for new homes increased from $372,745 in July to $374,288 in August. By product type, conventional loans composed 49.9% of loan applications, FHA loans accounted for 35.6% of activity, VA loans were used for 13.4% of applications. RHS/USDA loans composed 1.2%.
“Applications to purchase newly constructed homes remained higher than last year, although the monthly pace of applications slowed from July,” said Joel Kan, MBA’s vice president and deputy chief economist. “The bright spot in the August results was that estimated new home sales increased for the third consecutive month to its strongest sales pace in almost a year. Housing inventory levels continue to grow, which has given prospective homebuyers more buying options and continues to reduce sales price pressures. The average loan size remained below $380,000 for the fifth consecutive month and was close to 2021 levels.”
