Mortgage applications for new home purchases recorded a 13.8% year-over-year upswing in May, according to data from the Mortgage Bankers Association (MBA). Compared to April, application activity was up by 1%.
The MBA estimated new single-family home sales were running at a seasonally adjusted annual rate of 702,000 units in May, up 0.4% from April’s 699,000 units. On an unadjusted basis, MBA estimated that there were 63,000 new home sales in May, up 1.4% from 62,000 new home sales in April.
The average loan size for new homes decreased from $405,490 in April to $400,150 in May. By product type, conventional loans composed 63.4% of loan applications, FHA loans accounted for 26.5%, VA loans took up 9.8% and RHS/USDA loans composed 0.3%.
“There continues to be strength in the new home purchase market, as purchase applications increased in May compared to both the prior month and from a year ago,” said Joel Kan, MBA’s vice president and deputy chief economist. “With existing-home inventory still lagging in many markets, many homebuyers have turned their interest toward newly built homes, particularly FHA borrowers. The FHA share of applications was 26.5%, the highest share since the survey high of 27.1% in November 2023.”
;
