Applications for mortgages for new home purchases decreased 16% in November compared with October but were up 34.7% compared with November 2019, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey (BAS).
“November new home sales activity, both mortgage applications and home sales, ran at a pace considerably ahead of 2019, showing the ongoing strong growth in housing demand and new residential construction,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “However, the MBA estimates that after climbing to a new survey high in October, the seasonally adjusted pace of new home sales declined in November. Signs of a slowdown in the economic recovery likely contributed to the expected monthly decrease in activity.”
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 827,000 units in November, a decrease of 10.8% compared with October.
On an unadjusted basis, MBA estimates that there were 59,000 new home sales in November, a decrease of 15.7% compared with October.
By product type, conventional loans composed 71.8% of applications for new home purchases. FHA loans composed 16.8%, VA loans composed 10.4% and RHS/USDA loans composed 0.9%.
The average loan size for a new home sold in November was $357,554, up from $355,684 in October.