Applications for mortgages for new home purchases increased 6% in September compared with August and were up 10.8% compared with September 2023, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey.
“Applications for new home purchases declined in September, consistent with seasonal patterns, and continued to run ahead of last year’s pace,” says Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “New home sales continue to be an appealing option for prospective homebuyers as mortgage rates were lower during the month and more newly built options have been coming onto the market. The FHA share of applications was elevated to almost 29 percent, a sign that first-time buyers are active.”
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 680,000 units in September – a decrease of 12.4% compared with August.
On an unadjusted basis, MBA estimates that there were 54,000 new home sales in September, a decrease of 10% compared with August.
Looking at new home applications by product type, conventional loans composed 61.2% of applications, while FHA loans composed 28.7%, RHS/USDA loans 0.4% and VA loans 9.6%.
The average loan size for a new home in September increased to $402,658, up from from $395,935 in August.
Photo: Todd Kent