Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for March 2022 show mortgage applications for new home purchases decreased 5% compared to a year ago. Compared to February 2022, applications increased by 10%. This change does not include any adjustment for typical seasonal patterns.
“Mortgage applications for new home purchases increased in March, which is consistent with typical seasonal trends and a sign of strong underlying demand for housing,” says Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Potential buyers have increasingly looked to new homes as an option, given the lack of existing homes for sale. The average loan size continued to set record highs and reached $436,151. Growth in applications for larger loans continued to dominate application activity.”
MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 752,000 units in March 2022, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.
“MBA’s estimate of new home sales declined for the fourth consecutive month, with activity down 5 percent compared to February,” adds Kan. “Elevated home prices, rapidly increasing mortgage rates, and higher costs and supply shortages for building materials are all affecting sales growth.”
The seasonally adjusted estimate for March is a decrease of 4.9% from the February pace of 791,000 units. On an unadjusted basis, MBA estimates that there were 74,000 new home sales in March 2022, an increase of 12.1% from 66,000 new home sales in February.
By product type, conventional loans composed 76.6% of loan applications, FHA loans composed 13%, RHS/USDA loans composed 0.2% and VA loans composed 10.2%. The average loan size of new homes increased from $432,359 in February to $436,151 in March.
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