Mortgage applications for new home purchases in June declined by 6% from May but increased 2.4% from one year before, according to data from the Mortgage Bankers Association (MBA).
The trade group estimated new single-family home sales were running at a seasonally adjusted annual rate of 667,000 units in June, up 3.9% from the May pace of 642,000 units. On an unadjusted basis, MBA estimated that there were 56,000 new home sales in June, a decrease of 3.4% from 58,000 new home sales in May.
The average loan size for new homes increased from $372,825 in May to $375,218 in June. By product type, conventional loans composed 50.9% of loan applications while FHA loans accounted for 34.2%, VA loans encompassed 13.8%, and RHS/USDA loans had a 1.1% market share.
“Applications to purchase new homes continued to run stronger than last year’s pace. However, there was a decline from the previous month, which was consistent with the typical seasonal pattern at this time of the year,” said Joel Kan, MBA’s vice president and deputy chief economist. “MBA’s seasonally adjusted estimate of new home sales increased in June to its strongest pace in three months, as homebuyers responded to incentives provided by homebuilders looking to reduce their unsold inventory in several markets.”
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