Applications for new home purchases decreased 6%, on an unadjusted basis, in May compared with April but increased 18% compared with May 2015, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey.
About 68.4% of applications for mortgages for new homes were for conventional loans. About 17.6% were for loans backed by the Federal Housing Administration, about 13.4% were for Veterans Affairs loans, and about 0.6% were for Rural Housing Service/U.S. Department of Agriculture loans.
The average loan size for a new home in May was $328,032, up from $325,233 in April.
“Despite applications being down in May, each month this year has seen positive year-over-year growth in mortgage applications for new homes, and we expect modest growth in housing starts to be reported later this week as the spring building season continues, ” says Lynn Fisher, vice president of research and economics for the MBA, in a release. “While mortgage applications for new homes have declined almost 17 percent on an unadjusted basis from their peak in March of this year, applications in May remain eight percent above their level from the same time one year ago.”
The MBA estimates that sales of new single-family homes were running at a seasonally adjusted annual rate of about 488,000 units in May – a decrease of 3% compared with an annual pace of about 503,000 units in April.
On an unadjusted basis, the MBA estimates that there were 47,000 new home sales in May – a decrease of 2.1% from 48,000 in April.
