Applications for mortgages for new home purchases decreased 8% in September compared with August but were up 34.2% compared with September 2018, according to the Mortgage Bankers Association’s Builder Application Survey.
The MBA estimates new single-family home sales in September were running at a seasonally adjusted annual rate of 725,000 units, down 7.6% compared with 785,000 units in August.
On an unadjusted basis, MBA estimates that there were 56,000 new home sales in September, a decrease of 8.2% from 61,000 in August.
“Applications for new home purchases fell in September but remained 34.2 percent higher than a year ago, with our estimate for new home sales following a similar pattern,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a release. “Last month’s slowdown was likely caused by ongoing economic and interest rate uncertainty, as well as the fact that homebuilders continue to grapple with high building costs and labor shortages.”
“Purchase applications this year for new and existing homes for sale have consistently outpaced year ago levels,” Kan says. “This trend should continue in the final months of the year – especially considering how much higher rates were at the end of 2018.”
Conventional loans composed 69.2% of applications for mortgages for new homes sales in Septembner. FHA loans composed 18.4%, RHS/USDA loans composed 0.9% and VA loans composed 11.6%.
The average loan size for a new home was $330,807, down from $332,497 in August.