Mortgage applications for new home purchases in December were up by 22.2% from one year earlier, according to new data from the Mortgage Bankers Association (MBA). Compared to November, the application volume dipped by 4%.
The MBA estimated new single-family home sales were at a seasonally adjusted annual rate of 599,000 units in December, down by 11.5% from November’s pace of 677,000 units. On an unadjusted basis, MBA estimated that there were 46,000 new home sales in December, a decrease of 6.1% from 49,000 new home sales in November.
The average loan size for new homes increased from $390,049 in November to $405,368 in December. Roughly two-thirds of mortgage applications involved conventional loans and one-quarter involved FHA loans.
“The low level of existing homes for sale continues to divert prospective buyers to newly built homes. Mortgage applications for new homes showed a 22% annual gain in December – the 11th consecutive year-over-year increase in applications,” said Joel Kan, MBA’s vice president and deputy chief economist. “Compared to November 2023, applications were down 4% on a non-seasonally adjusted basis, consistent with December declines for the past two years.”
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