Mortgage applications for new home purchases decreased by 8% on an unadjusted basis in October compared with September, according to the Mortgage Bankers Association's (MBA) Builder Application Survey (BAS).
‘On top of normal seasonal slowdown, the October decline in mortgage applications to builder affiliates was likely amplified by some applications being pulled forward into September ahead of the implementation of the 'Know Before You Owe' rule on Oct. 3,’ says Lynn Fisher, vice president of research and economics for the MBA, in a statement. ‘Despite the decrease, our estimate of new single-family housing sales for October was up more than seven percent from a year ago.’
Looking at applications for new homes by loan type, about 67.2% were for conventional loans; 19.2% were for loans backed by the Federal Housing Administration; 12.7% were for Veterans Affairs loans; and 1.0% were for U.S. Department of Agriculture loans.
The average loan size for a new home in October was $320,881, down from $324,884 in September.
As of October, new single-family home sales were running at a seasonally adjusted annual rate of about 495,000 units, a decrease of 9.7% compared with the September pace of about 548,000 units, the MBA estimates.
On an unadjusted basis, there were about 39,000 new home sales in October – a decrease of 7.1% compared with about 42,000 in September, the MBA reports.